Ayan’s Shop, which sells Somali goods and houses a money transfer office called Juba Express in Fall Church. The American government and banks are shutting down cash transfers to Somalia because of fears of fraud and funds going to terrorism.(Jahi Chikwendiu/The Washington Post)
The world’s chokehold on Somalia’s key financial lifeline is getting even tighter.
As of February, many banks in the United States have largely stopped servicing the accounts used by money transfer operators to help Somalis in the country send money to their families and networks back in Somalia, often for basic needs such as food, medicine and school fees. The country, which has been ravaged by civil war, famine and lacks a central banking system, heavily relies on these remittances. Some organizations estimate that remittances represent 25 percent to 45 percent of the country’s gross domestic product. Somalia, which barely has a functioning government, is also plagued by the Islamist terrorist group Al-Shabab. Consequently, the threat of heavy fines for failure to comply with U.S. anti-terrorism regulations has many banks choosing to flee the market altogether.
- Written by Contributor
- Category: Opinion