Walk through Hargeisa today and the change is visible. New buildings rise along the main boulevards. The airport handles an increasing volume of regional traffic. Mobile money — Somaliland pioneered its own system years before M-Pesa became famous — flows through an economy that has learned to function without a conventional banking sector.

Somaliland's GDP growth has been consistent, if difficult to measure precisely. Remittances from the diaspora — estimated at over $1 billion annually — form a bedrock of household income. Livestock exports to the Gulf, historically the backbone of the economy, have recovered strongly. And infrastructure investment, anchored by the Berbera corridor, is opening new economic corridors.

The Investment Case

For investors willing to look beyond the absence of formal recognition, Somaliland offers a genuinely attractive proposition. Political risk is low by regional standards. The regulatory environment, while still developing, is improving. Land is available. Labour is young, growing, and increasingly educated.

The Berbera Economic Free Zone, developed in partnership with DP World, is designed to attract manufacturing, logistics, and light industry. Its proximity to major shipping lanes and its direct hinterland connection to Ethiopia — a market of over 120 million people — makes it potentially transformative.

The Policy Reforms Needed

MAAN Institute's economic research team has identified three priority reform areas.

Financial Sector Development

Somaliland's banking sector remains thin. Expanding access to formal financial services — including correspondent banking relationships — requires both domestic regulatory reform and international engagement to address de-risking concerns.

Investment Protection Framework

Investors need legal certainty. Developing a transparent, enforceable investment protection framework — potentially modelled on bilateral investment treaty standards — would significantly lower the perceived risk of doing business in Somaliland.

Education and Skills

Somaliland's young population is its greatest asset — but only if it is educated and skilled. Investment in technical and vocational training, and in university capacity, is a prerequisite for sustained economic growth.

Conclusion

Somaliland is not waiting for recognition to build its economy. It is building the economy that will make recognition inevitable. MAAN Institute is proud to be part of that work — providing the research and policy frameworks that support sustainable, inclusive growth.