Trade, Markets and State Formation in Somali East Africa

What happens to the economy if the state collapses or remains weak?

The Somali economic space that spans across the Horn of Africa provides unique insights into this question. Drawing on the collaborative research project GOVSEA, in this talk I highlight business patterns, the nexus between everyday trading and state formation and the political role of trade and markets in the Somali territories.

I review the Somali economy’s evolution from the 1990s to today and highlight innovative business technologies like hawala (money transfer) and their relation to Somali kinship. The ‘informal’, globalized, and dynamic flow of goods and services that characterize the Somali economy demonstrate its adaptiveness in light of permanent political and economic uncertainty.

I then provide a number of empirical examples centering around the role of trade corridors and market places in an attempt to tease out broader analytical insights into state formation dynamics.

Tobias Hagmann is associate professor at Roskilde University, a visiting researcher at the Danish Institute for International Studies (DIIS) and a fellow with the Rift Valley Institute in London/Nairobi. He directs the research project ‘Governing economic hubs and flows in Somali East Africa’, which studies the nexus between everyday trading and state formation dynamics in the Somali territories. See www.tobiashagmann.net and govsea.tumblr.com