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[Source: NUSACC's U.S.-Arab Trade Outlook 2013]

The Transitional Federal Government (TFG) of war-torn Somalia is working to restore order and governance after years of civil strife. As an interim government, the TFG has called on the international community to provide peacekeeping troops while it works to hold elections before its mandate expires in August 2011. TFG is also working with international donors to build institutions and infrastructure.

These days, Somalia is best known for sheltering pirates who are attacking vessels in the Arabian Gulf and the Horn of Africa, thereby threatening international shipping lanes, driving up insurance costs, and endangering lives. By year’s end 2010, some 35 ships and more than 650 hostages were being held for ransom by Somali pirates.

Despite widespread violence and instability, Somalia’s emerging economy has had some growth in such sectors as livestock, telecommunications, air transport, financial remittances and other services, thanks in large part to entrepreneurship and Somalia’s tradition-based legal system, known as Xeer. The short-term outlook for U.S. private sector activity in Somalia is very limited.

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