By Eng. Ahmed Baasaay - PhD Candidate, IIT Madras | Construction & Infrastructure Management | PPP
“Somalia’s challenge is not simply a shortage of money, but a shortage of structures that can turn opportunity into productive investment.” Eng Ahmed Baasaay
Somalia has significant economic potential. The problem is not a lack of resources or opportunities, but the limited systems needed to convert that potential into long-term investment and development. For decades, the country has depended heavily on international aid, remittances, and humanitarian assistance. While these sources have helped sustain Somalia, they cannot finance the infrastructure, employment, and productive economy required for the country’s next stage of development.
Somalia now needs to shift from dependence on development financing toward investment mobilisation.
Public-Private Partnerships (PPPs) could become an important instrument in that transition.
PPPs should not be viewed simply as contracts between government and business. They can form part of a broader development strategy for Somalia: a vehicle for mobilising public assets, strengthening policy capacity and skills, and leveraging private capital, technology, management, and international expertise.
Somalia has much to offer: a long coastline, a strategic location, fisheries, livestock, agricultural potential, growing cities, a young workforce, expanding digital services, and a dynamic private sector. Yet much of this potential remains underdeveloped because infrastructure, institutional capacity, access to finance, and investment certainty remain limited.
This presents a critical paradox: Somalia has investment opportunities, but too few investment-ready projects.
The world does not invest in a country simply because it possesses resources. Investors pursue opportunities when those opportunities can be transformed into bankable projects backed by credible institutions, predictable regulations, transparent procurement, appropriate risk allocation, and enforceable contracts.
Somalia’s PPP agenda should start here.
Instead of announcing large numbers of projects, Somalia should create a carefully selected pipeline of commercially viable and socially valuable projects. Potential entry points include renewable energy, ports and logistics, fisheries, livestock processing, water supply, waste management, urban transport, digital infrastructure, and industrial zones.
Energy, for example, is not merely an infrastructure sector. Affordable and reliable electricity is an economic platform. It enables manufacturing, cold storage, hospitals, digital businesses, education, and small enterprises. A well-designed energy PPP could therefore generate benefits far beyond the individual project.
The same principle applies to fisheries and livestock. Somalia should move beyond exporting raw resources and develop domestic value chains through processing, storage, logistics, certification, and export infrastructure.
From Inviting Investors to Actively Pursuing Them#
Somalia also needs to fundamentally transform its approach to investment promotion.
Officials should not simply attend international conferences and announce that Somalia offers investment opportunities. The government should identify potential investors, approach them directly, and present projects that are sufficiently prepared for serious consideration.
Five practical steps could drive a nationwide investor-attraction campaign.
First, create a national PPP investment pipeline.
The government should identify a limited number of priority projects and prepare concise investment profiles detailing project size, location, expected returns, public benefits, risks, and financing requirements.
Second, establish a targeted investor database.
Potential investors should be categorised by sector and geography, including infrastructure funds, pension funds, sovereign wealth funds, development finance institutions, regional companies, international corporations, and Somali diaspora investors.
Third, organise targeted investor roadshows.
Rather than relying on general promotional events, Somalia should take specific projects to financial centres in Africa, the Middle East, Europe, and Asia. These roadshows should focus on a small number of bankable projects and facilitate direct engagement between investors and decision-makers.
Fourth, develop a single PPP and investment platform.
Project information, laws, procurement procedures, feasibility studies, approvals, timelines, and contact details should be available through one professional platform. Uncertainty and arbitrary administrative delays are among the greatest obstacles to investment.
Fifth, establish an investor aftercare mechanism.
Attracting an investor is only the beginning. The government should continuously engage existing investors, resolve administrative problems, support expansion, and enable successful investors to become ambassadors for future investment.
Together, these actions would move Somalia from passive investment promotion to proactive investment mobilisation.
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However, PPPs must not become a shortcut around weak institutions.
Poorly prepared PPPs can create long-term fiscal obligations, political disputes, and expensive contracts that ultimately transfer risks back to taxpayers. Somalia therefore needs rigorous project appraisal, transparent procurement, independent oversight, fiscal-risk assessment, and clear rules governing unsolicited proposals.
The guiding principle should be simple:
The private sector should be incentivised to take and manage commercial risks, while the public sector should protect the public interest and assume only those risks that the state is best placed to manage.
PPPs also offer Somalia an opportunity to rethink its approach to Foreign Direct Investment (FDI).
Rather than simply telling investors that Somalia offers remarkable opportunities, the country should present those opportunities in a form investors can evaluate:
Here is the project. Here is the feasibility study. Here is the legal framework. This is the revenue model. These are the risks. This is the concession structure. This is the procurement process.
That is the difference between investment promotion and investment preparation.
Somalia’s objective should be to create an investment ecosystem in which an international investor can understand an opportunity, calculate the risks, access reliable information, and trust the rules.
The country does not need to become Africa’s largest PPP market overnight. It needs to become a credible and investable PPP market.
A sensible approach would begin with a small number of high-quality projects that are professionally prepared and openly and effectively tendered. Successful delivery would create a demonstration effect: one credible PPP would strengthen confidence in the next, while one successful foreign investment would reduce the perceived risk surrounding future investments.
Ultimately, Somalia’s development challenge is not simply a shortage of money. It is a shortage of investment structures capable of converting national assets into productive economic activity.
PPPs can help bridge that gap.
The question Somalia should ask is no longer:
“How much can the government afford to build?”
It should be:
“How much productive investment can Somalia responsibly mobilise?”
And the next question should be even more direct:
“Which investors do we want, which projects do we want them to finance, and what must Somalia do today to make those investments possible?”
That shift in thinking could become one of the foundations of Somalia’s next economic chapter.
PPP should not be Somalia’s destination. It should be one of the bridges that takes the country from reconstruction to investment-led development.
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Eng. Ahmed Baasaay is a PhD Candidate, IIT Madras | Construction & Infrastructure Management | PPP
**The views expressed in this article are those of the author and do not necessarily reflect the editorial position of Dawan Africa.