Somalia To Lose $500 Million This Year As Its Livestock Misses Out On Hajj To Saudi Arabia

Livestock export during Hajj season is a lucrative business and is estimated to earn Somali livestock traders up to half a billion dollars a year.

Millions of livestock from Somalia have been shipped to Saudi Arabia for the annual Muslim pilgrimage to the holy city of Mecca over many decades to feed some two million pilgrims from around the world.

Livestock export during Hajj season is a lucrative business and is estimated to earn Somali livestock traders up to half a billion dollars a year.

But this year, Somalia’s goats and sheep will not join the pilgrimage because Hajj has effectively been cancelled by Saudi authorities due to the Covid-19 pandemic—only a limited number of locals are allowed to attend Hajj. It leaves the Somali livestock industry at a crossroads and will likely lead to tens of thousands losing their livelihoods.

“Livestock traders, as well as herders, are suffering because of Hajj cancellation. I have invested almost everything in this business because I knew the returns would be great. I cannot take the livestock there neither do I have a local market,” says Abdi Ali, a trader in Hargeisa, the capital of Somaliland.

Somaliland, the self-declared state in northwestern Somalia, makes $250 million to $300 million each year, with the value of annual livestock export in the whole of the Horn of Africa region estimated at $1 billion.

But this year, Somalia’s goats and sheep will not join the pilgrimage because Hajj has effectively been cancelled by Saudi authorities due to the Covid-19 pandemic—only a limited number of locals are allowed to attend Hajj.

Saudi Arabia imports over 3 million heads of goats, sheep, cattle, and camels during the Hajj season, according to a 2019 report by the Veterinary Medicine and Science.

Livestock is Somalia’s main economic activity, constituting around 75% of the country’s export and contributing to about 40% of its gross domestic product, and is one of the few economic success stories. Camels in particular are big business in Somalia, with an annual export value estimated at over $250 million. The country has more camels than any other country in the world.

Besides Saudi Arabia—the largest buyer of Somalia’s livestock, it also exports to other Middle East North Africa countries including the United Arab Emirates, Qatar, Kuwait, Oman and Egypt. Most of this trade takes place during the Hajj.

Border closures

The Saudi’s cancellation compounds other challenges to trade, such as Covid-19-related border closures with neighbouring countries which also import Somali livestock. Some livestock is being sold locally at depressed prices, making it more difficult for families to afford basic necessities, including food.

Action Against Hunger, a non-governmental organization working in Somalia helping fight hunger, reports that the price for camels, for example, has dropped by nearly half, from $1,000 to $500.

The organization is bridging the gap by supporting 8,000 of the poorest families with cash transfers and ramping up programs like cash-for-work projects to give young people productive sources of income.

“In a normal year, this would be a good month for local households, when they could meet their own food needs and pay back debts accrued in the dry season,” said Ahmed Khalif, Action Against Hunger Somalia director.

This year’s cancellation is not the first time livestock export from Somalia to Saudi Arabia has been disrupted. In 2000, Saudi Arabia banned livestock export from Somalia because of the outbreak of Rift Valley fever. The ban lasted for nine years, and caused economic losses for millions who depend on livestock trade. In 2016, Saudi Arabia re-imposed a ban again, but suspended it during the Hajj.

The port of Berbera in Somaliland, which was recently modernized by Dubai-based DP World, has been the busiest in the livestock export industry. This is because Somaliland commands up to 85% market share in the supply of goats, according to the International Livestock Research Institute.

In this year’s Hajj season, the port will remain dormant and will not ship neither a goat nor sheep.

 

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