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5 March 2015

SOM105092.E

Somalia: Prevalence of cell phones and Internet cafes in Mogadishu, including the ability to use cell phones for financial transfers (2012-February 2015)

Research Directorate, Immigration and Refugee Board of Canada, Ottawa

1. Mobile Phone Usage in Somalia Overview

Sources state that following the outbreak of the civil war in 1991, the government ceased to regulate telecom networks, resulting in the emergence of several private mobile phone companies in Somalia (TeleGeography 23 July 2014; Somali Economic Forum 25 Apr. 2014). The Somali Economic Forum, an independent organization that serves as a "platform to discuss national economic and financial development" in Somalia (n.d.), reports that

Somalia's telecommunications sector has undergone a rapid rise fuelled by intense competition amongst the numerous telecommunication firms that dominate the country. These major telecom firms ... have succeeded in large part due [to] a deregulated market with the absence of: state control, regulatory laws, the collapse of foreign exchange controls and the inexistence of license providers. (Somali Economic Forum 25 Apr. 2014)

According to sources, mobile phone companies in Somalia provide the cheapest rates for telecommunications services in Africa (Sheikh Ali and Yusuf Dhaha 2-3 Dec. 2013, 2; US 23 June 2014).

Sources report that wireless telecommunications services are available across Somalia (CDAC Jan. 2012; Somali Economic Forum 31 Jan. 2014). In a 2012 guide on media and telecom services in Somalia, the Infoasaid Project [1] reports that mobile networks provide "extensive" mobile coverage throughout the country (CDAC Jan. 2012, 84). The Somali Economic Forum states that "[t]elecommunication companies have installed country-wide networks of wireless stations and provided affordable equipment that have enabled local communities to stay connected" (31 Jan. 2014). A 2012 study titled "Investigating Mobile Money Acceptance in Somalia: An Empirical Study" by Osman Sayid, Abdelghani Echchabi, and Hassanuddeen Abd. Aziz [2], published in the Pakistan Journal of Commerce and Social Science, similarly states that "private companies provide affordable fixed-line, mobile phone and Internet services in every major city in Somalia," while also noting that such services are of "high quality, which are not available in many parts of the continent" (Sayid et al. 2012, 270).

The Somali Economic Forum states that, as of April 2014, there were more than 20 telecom companies active in Somalia (25 Apr. 2014). Sources note that the major mobile network service providers in Somalia are Hormuud Telecom, Somafone, Telesom, Nationlink, Telecom Somalia (The EastAfrican 18 May 2013; Sheikh Ali and Yusuf Dhaha 2-3 Dec. 2013, 2), and Golis Telecom (ibid.).

In an article dated 19 April 2012, Sabahi Online, a Horn of Africa news website sponsored by the US Africa Command, the military command responsible for supporting US efforts in the region (AllAfrica n.d.), reported that Nationlink, Hormuud, and Telecom Somalia were the principle competitors in the Mogadishu market (Sabahi Online 19 Apr. 2012). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

According to a study based on a national survey conducted in 2013 by the Broadcasting Board of Governors (BBG), a US federal agency that oversees all US civilian international media (US n.d.), and Gallup, a company that provides "analytics and advice" to leaders and organizations (Gallup n.d.), "more than seven in 10 Somalis (72.4%) say they personally own a mobile phone" (US and Gallup n.d.). The same study notes regional variations, with ownership rates at 78.5% in South-Central Somalia, 73.1% in Puntland, and 56.2% in Somaliland (ibid.). Conversely, the 2012 Infoasaid guide states that "reliable statistics on mobile phone ownership do not exist," noting that ownership rates can range from 7 to 39 per cent of the population (CDAC Jan. 2012, 84). The 2014 Central Intelligence Agency (CIA) World Factbook reports that there are 658 000 mobile phones in use in Somalia (US 23 June 2014). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

2. Financial Transactions via Mobile Phone in Somalia

Sources state that several mobile phone companies provide Somali citizens with mobile financial transfer services (The EastAfrican 18 May 2013; Sabahi Online 19 Apr. 2012; Sheik Ali and Yusuf Dhaha Dec. 2013, 2). According to a paper presented at the Kuala Lumpur International Business, Economics and Law Conference in December 2013 titled "Factors Influencing Mobile Money Transfer Adoption Among Somali Students," by Ali Yassin Sheikh Ali and Ismail Shiekh Yusuf Dhaha [3],

service providers offer MMT [mobile money transfer] with different brands. For instance, Telesom Somaliland in northern regions provides ZAAD service; Golis Telecom in southern and central regions provides SAHAL service, while Nationlink and Hormuud Telecom in southern and central regions provide E-maal and Electronic Voucher Cards (EVC Plus) respectively. (ibid.)

Sources further note that MMT services are relied upon by individuals because of the lack of a functional banking system in Somalia (The EastAfrican 18 May 2013; Sabahi Online 19 Apr. 2012; Al Jazeera 31 Aug. 2013). According to sources, Hormuud Telecom was the first company to offer these services in Mogadishu (Sheik Ali and Yusuf Dhaha 2-3 Dec. 2013, 3; Sayid et al. 2012, 270); Golis Telecom introduced the service in Bossaso; and Telesom in Hargeisa (ibid.).

In correspondence with the Research Directorate, a representative from the Somali Canadian Education and Rural Development Organization (SCERDO), a Canadian non-profit organization that "advocate[s] the needs of rural Somalia including economic development, community enhancement, environmental protection, and effective use of available resources" (n.d.), stated that "mobile money transfer is common in use and available in Somalia" (SCERDO 6 Feb. 2015). The Somali Economic Forum states that "[t]hese [MMT] service providers receive a high volume of transactions averaging around 34 transactions per customer on a regular weekly basis" (25 Apr. 2014). According to Sheikh Ali and Yusuf Dhaha, "[m]ore than 70% of the total 2.5 million Hormuud mobile subscribers are currently using EVC Plus for daily transactions since its inauguration two year[s] ago" (Dec. 2013, 2). The Globe and Mail reports that, in Somaliland, more than half of the 500,000 subscribers to Telecom use Zaad MMT service (21 June 2013).

Sources report that MMT technology is utilized by businesses and merchants in Somalia (Al Jazeera 31 Aug. 2013; Sheik Ali and Yusuf Dhana 2-3 Dec. 2013, 2). According to Sheikh Ali and Yusuf Dhaha,

EVC Plus [has] become one of the services that people depend on [when conducting] their daily transactions in south and central Somalia. Most business activities now use this service as payment method including water and electricity bills, while most of the family daily business transactions occur through this service. (ibid.)

Al Jazeera stated in 2013 that "[t]he service is catching on fast and moving into other traditional everyday activities" such as paying electricity bills and booking domestic flights (31 Aug. 2013). The Globe and Mail reports that, in Somaliland, almost every merchant will accept payment through mobile devices (The Globe and Mail 21 June 2013). The same source states that "many companies use Zaad for all of their salary payments to their employees" (ibid.).

2.1 Mobile Transfer of Remittances to Somalia

Sources note that remittances from the Somali diaspora can be received in Somalia via MMT services (SCERDO 6 Feb. 2015; The Globe and Mail 21 June 2013; The EastAfrican 18 May 2013). The SCERDO representative stated that Somali citizens are able to receive money from the diaspora through mobile phones (SCERDO 6 Feb. 2015). The EastAfrican, a weekly newspaper published in Kenya [4] states that "in the absence of a banking sector, these [MMT] services are vital for transferring money into the country from the diaspora" (18 May 2013).

The Globe and Mail reports that, in Somaliland, remittances are "increasingly" being sent there electronically, noting that the "mobile-money system grew out of Somaliland's heavy dependence on remittances from Somalis who work abroad - an estimated $1-billion annually" (21 June 2013). For more information on remittances sent to Somalia from the diaspora, please see Response to Information Request SOM105093.

3. Internet Connectivity in Somalia

In 2012, Sabahi Online quoted the marketing director for Global Internet Company, the "largest internet provider in Somalia" (Sabahi Online 19 Apr. 2012), as stating that there are no "precise" statistics on the "exact" number of Internet users in Somalia, but that estimates show that 1.2% of Somali's population had access to the Internet (ibid.). Other sources from 2012 and 2013 report the percentage of Internet users in Somalia to be from 1.14% (BBC 23 Oct. 2012) to 1.3% (CIO East Africa 14 Nov. 2013). The BBC noted in a 2012 article that, while the percentage of Internet users is low, demand in Mogadishu was "growing rapidly" (23 Oct. 2012). According to the 2014 CIA World Factbook, Somalia has approximately 106,000 Internet users (according to 2009 data) and 186 Internet hosts (according to 2012 data) (US 23 June 2014). A 2014 article by Inter Press Service (IPS), a global news agency that focuses on issues such as development, globalization, the environment and human rights (IPS n.d.), quoted Internet World Stats [5], as stating that over 125,000 of Somalia's 10 million people [1.25%] use the Internet (ibid. 16 Feb. 2014).

The BBG and Gallup 2013 survey reports that 51.3% of Mogadishu residents connect to the Internet each week (US and Gallup n.d.). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

According to sources, a fibre-optic cable [6] system has been launched in Mogadishu (BBC 10 Apr. 2014; US 23 June 2014; Somali Economic Forum 25 Apr. 2014). A 2014 Somali Economic Forum article states that the first terrestrial fibre-optic cables were installed in Mogadishu in April 2014 (ibid.). According to sources, prior to the installation of fibre-optic cables, Somalia's Internet was provided exclusively by satellite (CIO East Africa 14 Nov. 2013; Reuters 12 Nov. 2013). The Oxford Internet Institute, an academic research institute based at the University of Oxford, which studies the societal implications of the Internet (n.d.), states that fibre optic broadband cables provide the East African region with Internet services at "much greater speeds" and "much lower prices" (Mar. 2010). Sources report that the fibre-optic cable system installed in Mogadishu provides the city with high speed Internet (BBC 10 Apr. 2014; Somali Economic Forum 25 Apr. 2014) and WIFI hotspots (ibid.). According to BBC, the fibre-optic cable system is available only in Mogadishu, and the current security situation will limit high-speed Internet expansion to the rest of the country (10 Apr. 2014). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

3.1 Internet Cafes

According to the Infoasaid Project in 2012, "internet cafes are extremely popular in areas where there is a connection" (CDAC Jan. 2012). In 2012, the BBC quoted the chief executive of Somalia Wireless, an Internet provider in Mogadishu, as stating that "hotspots now cover nearly 40% of the city, connecting universities, NGOs, hotels, news agencies, and cafes" (BBC 23 Oct. 2012). Reporting by the BBC in 2014 also notes that "people have been flocking to hotels and internet cafes" to try out the fast Internet service since the installation of fibre-optic cables in Mogadishu (ibid. 10 Apr. 2014). Further information on the prevalence of Internet cafes and WIFI hotspots in Mogadishu could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

4. Al Shabaab and Telecom Disruptions

Sources state that, in January 2014, Al Shabaab ordered Telecom service providers to shut down Internet services in Somalia (ibid.; IPS 16 Feb. 2014; CIO East Africa 24 Jan. 2014). According to IPS, in response to Al Shabaab's directive, Hormuud Telecom "switched off the service not only to areas controlled by Al Shabaab but across the centre of the country and in Mogadishu," reporting that "tens of thousands" of Hormuud Telecom subscribers were unable to access the Internet on their mobile devices (16 Feb. 2014). According to CIO East Africa, an information and communications technology industry magazine in East Africa (23 Mar. 2012), Hormuud Telecom and Nationlink, "the country's main internet providers," were shut down by Al Shabaab (24 Jan. 2014).

Sources indicate that fibre-optic Internet services were also banned by Al Shabaab in early 2014 (Africa Review 23 Jan. 2014; Horseed Media 6 Feb. 2014). According to Horseed Media, a news agency established by the Somali diaspora in the Netherlands and Finland that reports on Somali current affairs (ibid. n.d.), Al Shabaab banned companies from providing "mobile internet and fibre-optic services, which were to be launched soon" (ibid. 6 Feb. 2014). Conversely, a 16 February 2014 article published by IPS states that while Internet services on mobile devices were shut down, fixed broadband services were still available (IPS 16 Feb. 2014). The same article states that individuals were forced to use Internet cafes during the Internet shut-down as mobile service providers were not operational (ibid.). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

Sources report that Al Shabaab ordered a mobile Internet services shutdown in early 2014 due to concerns by the group about "enemy spying" (Garowe Online 8 Dec. 2014; CIO East Africa 24 Jan. 2014). IPS states that Al Shabaab blamed mobile Internet services for airstrikes "carried out by 'the enemy' in areas under their control" (16 Feb. 2014). CIO East Africa notes that Al Shabaab also believed that the Internet "was leading to immorality" (24 Jan. 2014). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

According to the SCERDO representative, as of 6 February 2015, "Internet services have been resumed permanently in Mogadishu and the rest of the country" (6 Feb. 2015). Corroborating information could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

This Response was prepared after researching publicly accessible information currently available to the Research Directorate within time constraints. This Response is not, and does not purport to be, conclusive as to the merit of any particular claim for refugee protection. Please find below the list of sources consulted in researching this Information Request.

Notes

[1] The mandate of the InfoasaidProject, which ended in December 2013, was "to strengthen the capacity and preparedness of aid agencies to respond to the information and communication needs of crisis-affected populations" while also partnering with "a number of aid agencies to help inform and support their communications response in a variety of emergency contexts" (CDAC 28 July 2014). The project was led by member organizations of the Communicating with Disaster Affected Communities (CDAC) Network, a "cross-sector collaboration" of humanitarian and media development organizations and technology providers that works to provide "life-saving information" to crisis-affected communities (ibid. n.d.).

[2] At the time of the publication of the study, and according to information provided with the published study, Osman Sayid was affiliated with the Institute of Islamic Banking and Finance, International Islamic University of Malaysia (Sayid et al. 2012, 269). Abdelghani Echchabi was affiliated with the Department of Business Administration, Faculty of Economics and Management Sciences, International Islamic University Malaysia (ibid.). Hassanuddeen Abd. Aziz was affiliated with the Department of Finance, Faculty of Economics and Management Sciences, International Islamic University Malaysia (ibid.).

[3] At the time of the presentation of the paper, and according to information published in the conference proceedings, Ali Yassin Sheikh Ali was affiliated with the Department of Business Administration at the Sudan University of Science and Technology (Sheikh Ali and Yusuf Dhaha Dec. 2013, 1). Ismail Sheikh Yusuf Dhaha was affiliated with the Department of Communication, International Islamic University Malaysia (ibid.).

[4] The EastAfrican is published by Nation Media Group (NMG n.d.a), an independent media company in East and Central Africa (ibid. n.d.b).

[5] Internet World Stats is a website that publishes international Internet usage statistics for over 233 countries (IWS n.d.). The statistics are consolidated by the site from "periodic surveys and official country user records" (ibid.).

[6] Oxford Dictionaries defines fibre-optic cable as "[a] cable made of thin flexible fibres of glass, used for transmitting information in the form of light signals, chiefly in telecommunications (n.d.).

References

Africa Review. 23 January 2014. Abdulkadir Khalif. "Somali Islamists Start Enforcing Internet Ban." <http://www.africareview.com/News/Somali-Islamists-start-enforcing-Internet-ban/-/979180/2157090/-/5xl1fcz/-/index.html> [Accessed 2 Mar. 2015]

Al Jazeera. 31 August 2013. Hamza Mohamed. "Electronic Transfers Improve Somalia Economy." <http://www.aljazeera.com/indepth/features/2013/08/2013831141614925682.html> [Accessed 9 Feb. 2015]

AllAfrica. N.d. "Somalia News Sources." <http://allafrica.com/list/aans/post/af/cat/ somalia/pubkey/publisher:editorial:00011204.html> [Accessed 24 Feb. 2015]

British Broadcasting Corporation (BBC). 10 April 2014. "Somalia in High Speed Internet 'Culture Shock'." <http://www.bbc.com/news/world-africa-26973587> [Accessed 9 Feb. 2015]

_____. 23 October 2012. Jonathan Kalan. "Somalia's Ambitions Online Could Bring Mogadishu to the World." <http://www.bbc.com/news/business-19961266> [Accessed 9 Feb. 2015]

CIO East Africa. 24 January 2014. Kamau Mbote. "Al Shabaab Shuts Out Central and Southern Somalia from Internet." <http://www.cio.co.ke/news/top-stories/al--shabaab-shuts-out-central-and-southern-somalia-from-internet> [Accessed 29 Jan. 2015]

_____. 14 November 2013. "Mogadishu Gets International Fiber Connectivity." <http://www.cio.co.ke/news/main-stories/mogadishu-gets-international-fiber-connectivity> [Accessed 29 Jan. 2015]

_____. 23 March 2012. "About CIO." <http://www.cio.co.ke/about-cio> [Accessed 29 Jan. 2015]

Communicating with Disaster Affected Communities (CDAC) Network. 28 July 2014. "Infoasaid.org Has Moved." <http://www.cdacnetwork.org/i/20140728102420-genh0> [Accessed 18 Feb. 2015]

_____. January 2012. Infoasaid Project. Somalia: Media and Telecoms Landscape Guide. <http://www.cdacnetwork.org/contentAsset/raw-data/72053e36-7473-4e47-8ae8-ff20559bf055/attachedFile> [Accessed 18 Feb. 2015]

_____. N.d. "Who We Are." <http://www.cdacnetwork.org/about-the-network/who-we-are/> [Accessed 23 Feb. 2015]

The EastAfrican. 18 May 2013. Russell Southwood. "Somalia Counts on Telecoms Sector for Revival of Economy." <http://www.theeastafrican.co.ke/news/Somalia-counts-on-telecoms-sector-for-revival-of-economy-/-/2558/1856326/-/kbrba4/-/index.html> [Accessed 9 Feb. 2015]

Gallup. N.d. "About Gallup." <http://www.gallup.com/corporate/177680/gallup.aspx> [Accessed 23 Feb. 2015]

Garowe Online. 8 December 2014. "Somalia: Al Shabaab Takes Telecom Services Off Air in Bay." (Factiva)

The Globe and Mail. 21 June 2013. Geoffrey York. "How Mobile Phones Are Making Cash Obsolete in Africa." <http://www.theglobeandmail.com/news/world/how-mobile-phones-are-making-cash-obsolete-in-africa/article12756675/> [Accessed 9 Feb. 2015]

Horseed Media. 6 February 2014. Ayub Abdirahman. "Mobile Internet Service in Southern Somalia Shut Down." <http://horseedmedia.net/2014/02/06/mobile-internet-service-southern-somalia-shut/> [Accessed 2 Mar. 2015]

_____. N.d. "About Horseed Media." <http://horseedmedia.net/profile/> [Accessed 2 Mar. 2015]

Internet World Stats (IWS). N.d. "Surfing and Site Guide." <http://www.internetworldstats.com/surfing.htm> [Accessed 20 Feb. 2015]

Inter Press Service (IPS). 16 February 2014. Ahmed Osman. "Somalia Powerless to Stop Al-Shabaab Mobile Internet Shutdown." <http://www.ipsnews.net/2014/02/somalia-powerless-stop-al-shabaab-mobile-internet-shutdown/> [Accessed 9 Feb. 2014]

_____. N.d. "About Us." <http://www.ipsnews.net/about-us/> [Accessed 9 Feb. 2014]

Nation Media Group (NMG). N.d.a. "Our Brands." <http://www.nationmedia.com/> [Accessed 23 Feb. 2015]

_____. N.d.b. "About Us." <http://www.nationmedia.com/> [Accessed 23 Feb. 2015]

Oxford Dictionaries "Fibre-Optic Cable." <http://www.oxforddictionaries.com/definition/english/fibre-optic-cable> [Accessed 2 Mar. 2015]

Oxford Internet Institute. March 2010. "Development and Broadband Internet Access in East Africa." <http://www.oii.ox.ac.uk/research/projects/?id=59> [Accessed 2 Mar. 2015]

_____. N.d. "About Us." <http://www.oii.ox.ac.uk/about/> [Accessed 2 Mar. 2015]

Reuters. 12 November 2013. "Somalia Gets First Fiber Optic Link to the World." <http://www.reuters.com/article/2013/11/12/us-somalia-telecoms-idUSBRE9AB0SN20131112> [Accessed 9 Feb. 2015]

Sabahi Online. 19 April 2012. Mahmoud Mohamed. "In Somalia, New Telecommunication Technologies Play Important Role." <http://sabahionline.com/ en_GB/articles/hoa/articles/features/2012/04/19/feature-01> [Accessed 6 Feb. 2015]

Sayid, Osman, Abdelghani Echchabi and Hassanuddeen Abd. Aziz. 2012. "Investigating Mobile Money Acceptance in Somalia: An Empirical Study." Pakistan Journal of Commerce and Social Science. Vol. 6(2). <http://www.jespk.net/publications/90.pdf> [Accessed 6 Feb. 2015]

Sheikh Ali, Ali Yassin, and Ismail Sheikh Yusuf Dhaha. 2-3 December 2013. "Factors Influencing Mobile Money Transfer Adoption Among Somali Students." Conference Proceedings Vol. 1 from Kuala Lumpur International Business, Economics and Law Conference, Kuala Lumpur, December 2-3 2013. <http://www.researchgate.net/ publication/259338165_FACTORS_INFLUENCING_MOBILE_MONEY_TRANSFER_ ADOPTION_AMONG_SOMALI_STUDENTS> [Accessed 6 Feb. 2015]

Somali Canadian Education and Rural Development Organization (SCERDO). 6 February 2015. Correspondence from a representative to the Research Directorate.

_____. N.d. "About Us." <http://www.scerdo.org/about-us-2/> [Accessed 6 Feb. 2015]

Somali Economic Forum. 25 April 2014. "Somalia's Telecom Sector: An Economic Success Story?" <http://www.somalieconomicforum.org/sef-blog/27/Somalias-Telecom-sector-an-economic-success-story.html> [Accessed 29 Jan. 2015]

_____. 31 January 2014. "IMF, Donors Helping Somalia Rebuild Self-sustaining Economy." <http://www.somalieconomicforum.org/news/29/IMF-Donors-Helping-Somalia-Rebuild-Self-Sustaining-Economy.html> [Accessed 29 Jan. 2015]

_____. N.d. "About Us." <http://www.somalieconomicforum.org/about-us> [Accessed 29 Jan. 2015]

TeleGeography. 23 July 2014. "Hormuud, Somtel, Nationlink Sign Interconnection Deal." <https://www.telegeography.com/products/commsupdate/articles/2014/07/23/hormuud-somtel-nationlink-sign-interconnection-deal/> [Accessed 29 Jan. 2015]

United States (US). 23 June 2014. Central Intelligence Agency (CIA). "Somalia." The World Factbook. <https://www.cia.gov/library/publications/the-world-factbook/geos/so.html> [Accessed 10 Feb. 2015]

______. N.d. Broadcasting Board of Governors (BBG). "About." <http://www.bbg.gov/about-the-agency/> [Accessed 29 Jan. 2015]

United States (US) Broadcasting Board of Governors (BBG) and Gallup. N.d. Media Use in Somalia 2013. <http://www.bbg.gov/wp-content/media/2013/11/gallup-somalia-brief.pdf> [Accessed 29 Jan. 2015]

Additional Sources Consulted

Oral sources: Attempts to contact the following organizations were unsuccessful within the time constraints of this Response: Action Africa Help; Canadian Somali Congress; Center for Research and Dialogue Somalia; Human Development Concern for the Horn of Africa; KAALO Aid and Development; Observatory of Conflict and Violence Prevention; Sahan Research and Development Organization; Social-life and Agricultural Development Organization; Somali-Canadian Assocation of Etobicoke; Somali Canadian Society of Calgary; Somali Peace Line.

Internet sites, including: African Union – Mission in Somalia; Agence-France Presse; Amnesty International; The Brookings Institution; Carnegie Endowment for International Peace; East African Community; Freedom House; International Business Times; United Nations – Development Programme, High Commissioner for Refugees, Somalia Return Consortium; Transparency International; Woodrow Wilson Center for Scholars.