The Rise Of Somali Capital
The increasingly visible presence of the Somali community in Nairobi during a period in which Kenya is undergoing its most severe political tests only serves to expose new ethnic and regional fissures. In this article excerpted from Trade Routes in The Chimurenga Chronic, Parselelo Kantai looks at the rise of Somali diaspora capital, and argues that ethnic capital mobilised at both an individual and communal level (the notional claims to ethnic-blindness notwithstanding) is still the most effective route to securing economic and political legitimacy.
Early last month, I bumped into a friend in the passport queue at Nyayo House in Nairobi. My passport needed renewal; she was with her teenage daughter, who needed one. We knew each other from Nairobi’s literary circles, those few spaces where you could still have a conversation across ethnic lines in those tense months of the nation’s atomisation following last year’s stolen election, its bloody aftermath and the rickety, artificial peace that governed us.
That could have been the reason we soon began talking about Somalis. It could also have been that on that knotty, winding queue the sheer number of Somalis stood out. In any case, everywhere you went in downtown Nairobi, there were loud whispers of a Somali ‘invasion’. You very quickly understood that this had nothing to do with the refugee problem in northern Kenya. That was another country. You also understood that this was a crude form of southern Kenya public therapy. For a people for whom ‘negative ethnicity’, the newspaper euphemism for the prevailing ethnic rancour that had shredded the nation into a farcical edifice of a thousand cuts, ‘othering’ the Somalis restored a sense of collective indignation. Hate and rancour were the only things holding us together.
“These people have become too much,” my friend whispered hotly, wrinkling her nose in the direction of a Somali family in the queue. “D’you know they’ve come all the way up to Kileleshwa?”
I was surprised at her vehemence. She had always talked in a language that irritated me – the exultant language of the reaspora bubble in leafy-suburb Nairobi. It was a velvety, arriviste Nairobi English, full of possibilities and faux tourist innocence. It was an insider language that walked on water, saw no evil, advertised its privilege with cocktail kisses, intimate nods, bursts of happy laughter. It was used to suggest non-contamination, that one’s head was above the loud sucking sounds of this place, the descent into naked Nairobi calculations, pettiness, desperation. It was not the other thing: that guarded edge in your voice that revealed a loss of independence and optimism, that now your diaspora dollars were running dangerously low and you had recently turned a page in your contact book, and made the call to a powerful uncle for a job, a contract, a deal.
But Kileleshwa, an old mzungu suburb whose civil servant houses were being transformed into apartments for the yuppy beneficiaries of the Kibaki-era economic boom and the returning Western diaspora, exiled for two decades by Moi repression, was now under siege. There was no velvet to couch this new fear.
Everybody had a Somali anecdote. And the stories, with their sense of emergency, of invasion, became more lurid the further west of Uhuru Highway you went. Somali traders, once restricted to Eastleigh, a grubby suburb in Eastlands, had now made enough money to venture into the bastions of privilege. They were buying up properties all over the city, paying huge amounts. Realtors reported that, in that season of uncertainty, it was Somali investment in real estate that was keeping the market afloat.
One morning a retired judge received a phone call from her lawyer. He told her there was someone who wanted to meet her, a potential investor. More out of curiosity than anything else, she agreed to the meeting. The investor turned out to be a Somali man. He wanted to buy her house. It was in one of the most prestigious residential addresses in the city, a street that was home to Nairobi’s old money. He offered her ten times its value. She refused. She had been living there for 30 years. She knew nowhere else.
Unable to explain the source of the money, a puzzled city searched for answers. The media joined in the speculation, suggesting that the new Somali money was the proceeds from piracy. Coupled with the threat of militant Islam and Al Shabaab, Somali business activities, said the media, were a national security threat. The Somali community vehemently denied it, said they were legitimate businesspeople who abhorred piracy. In fact, they said, militant Islam was bad for business. But how else could one explain the sudden surge?
In some cases, explanations were dispensed with and the rawness of the season, the ethnic rancour, seeped out, showed the extent of the unease. There was a wedding in Muthaiga, the oldest of the old colonial suburbs, and the poshest. A Kikuyu high society couple was getting married. Both bride and groom were connected to politics and Kibaki money and were from the Western diaspora. Among those they invited were three Somali sisters, childhood friends of the groom from a family he had lived with at one point during his sojourn in the US. Amid the hubbub of the evening party, one of the sisters started dancing with one of the groom’s friends. It was late and there was a good amount of drinking going on. It didn’t take much to get the man’s girlfriend going. She walked up to the couple and asked loudly what this dirty Somali malaya was doing with her man. There was some pushing, an exchange of ugly words.
It was the usual drunken scene at that kind of hour, at that kind of party. But suddenly it seemed that everybody had joined in a chant of dirty Somali malaya go back to where you belong. It was suddenly a brawl, an anti-Somali brawl. The girl who had instigated it was connected. She had bodyguards and a driver. She called up the bodyguards and ordered them to throw out the sisters. There was shouting and crying, snotty tears, hurried gatherings of shoes and handbags. It was the groom who let them out. In the car park, one of the sisters asked him what they had ever done to him. He said he didn’t want any trouble. These women who had grown up in a Nairobi where the language of class and privilege seemed to provide a cushion against the jagged edges of tribe – the huddled language of falling and hustling – were now just another band of refugees.
Anti-Somali xenophobia has a long tradition in Kenya. The image of the Waria – derogatory slang for Somali – was permanently captured in the 1970s and 1980s in Vioja Mahakamani, Kenya’s longest-running TV court-room comedy. To its credit, Vioja Mahakamani parodied everyone, offering hilarious caricatures of rural migrants in the city, and in the process, entrenched the old colonial stereotypes of Kenyan communities.
“East Africa’s South Asians had long ago learned the value of organised ethnic capital. It was the secret to their success. Now they were being challenged from an unlikely quarter: the Somali community of Eastleigh.”
In Vioja, the image of the Somali is represented by Chief Superintendent Wariahe, a tall, light-skinned policeman whose rectitude is only betrayed by his appalling Kiswahili, the source of enduring mirth.
Outside Wariahe’s clean-cut image, lies another stereotype: that of the Somali as a dirty, khat-chewing Muslim pastoralist more at home in the wastelands of northern Kenya than in the city. In this particular construction, the Somali in the city is a stranger, an invader.
It is perhaps this latter image that underpinned all the talk of a Somali invasion in Nairobi.
The Somali invasion, whispered on the street and occasionally affirmed by speculative newspaper articles, had all the mythic strangeness of urban legend. Nobody had seen it coming and this added to the confusion, the rumours. Like the Ugandan women in the 1970s who with their batting-eyelash guile, their bedroom disco, were stealing rich, Kenyan men. They were using witchcraft, it was said. Behind the myths and xenophobia, however, lay a far less exciting story, but one which spoke of new social undercurrents.
As the chaos of Idi Amin’s rule deepened, Ugandans had fled to Kenya, including qualified teachers, nurses and doctors whose skills and services were often superior to those of the locals. Among them were women who, freed from their domestic confines as Uganda melted down, had discovered a flair for business, and had become international traders roaming between Kampala, Nairobi and the Middle East. To secure licenses and contracts in Kenya, they had befriended government officials and politicians, cut them in on the action maybe even slept with some of them. When business deals between the women and the politicians broke down, the police were sent in on city-wide swoops targeting Ugandans. Envy and fear, rough around the edges, formed the base stock of urban legend.
Similarly, these Somali invasion stories were now being exchanged and transacted in an underground economy for which there existed no formal vocabulary. No words had been legislated as yet to sanction the sense of fear and besiegement running through the city’s trading and merchant classes. Because for all intents and purposes, the Somali invasion was really the grudging acknowledgement of the entry of a new stream of organised ethnic capital into the city; Somali money was supplanting more established ethnic capital; the Indian and Kikuyu, the two most visible mercantile communities, were being outmanoeuvred. As a result, street panic curdled into open xenophobia.
‘I’m Kenyan but Somali’:
How Rashid Jibril got his ID
Sijui is Kiswahili for “I don’t know.” But within the Kenyan Somali community it has a more colloquial meaning: it is the term used to refer to urban Somali ‑ the people who don’t know home because they left for the city so long ago. People like Rashid Jibril.
Nairobi is home for Rashid. He grew up in Pangani, a lower middle class neighbourhood in Eastlands. In the 1970s, Pangani was multi-racial and multi-ethnic. There was still a significant Indian population. Everybody spoke Sheng and Kiswahili on the street. Rashid’s mother, who worked for the Kenya Pipeline Company, was determined to give her two sons a good education. They both went to Hospital Hill Primary School, an old settler school, integrated in the 1960s after independence and whose administration insisted on maintaining certain standards, fluency in English at the top of that list.
For Rashid, Somali existed indoors, among the adults of his extended family – their conversation to which he always felt a certain distance. His lack of fluency in Somali is a legacy of that childhood. But the adults themselves were considered sijuis. His people had left the Horn in the early 1900s. They were herders, pastoralists from northern Somalia. Rashid was told that they had followed the British upper class adventurers back to Kenya from their lion-hunting trips in Somaliland. They acted as trackers, guides and porters, the unheralded native eyes that opened the routes for colonial heroism.
Rashid’s people had followed these adventurers into the Kenyan Rift Valley and tended their herds for them. Then they had dispersed, scattering across the country. There were relatives in western Kenya, Nairobi, northern Kenya and the Rift Valley
Playing with the neighbourhood kids in Pangani, he cannot remember ever being made to feel like the outsider, the minority kid. They were just a bunch of Nairobi kids.
But he was dimly aware that there was a war raging, and that he was somehow connected to it.
“My first knowing of the question mark around Kenyan Somalis was as a child,” he recalls. “You hear stories about the shiftas, who were portrayed as a renegade band of folks with arms who would attack transport vehicles, police and military outposts. They were even accused of poaching. But I grew up very far from all that. I knew there was a place far away where there were some renegade Somalis. At that point, as an urban Somali, the ‘Somali Problem’ was a rural phenomenon.”
Somalis occupy an ambiguous place in the Kenyan political imagination. They were the northern outsiders, who at independence in 1963 were thrust into a forcible union with southern Kenya. During a constitutional referendum on the eve of Uhuru, Kenyan Somalis voted overwhelmingly against being governed by an independent Kenyan state, opting instead to join their kinsmen in Djibouti, the Ogaden in eastern Ethiopia and those in Somalia, north and south, in a proposed Greater Somali union. These were the five stars of the Somali flag, the symbols of nationalism.
Independent East Africa’s new and existing states regarded Somali nationalism as a threat to the region’s security – a violation of the principle of territorial integrity of existing colonial borders, what would become a central pillar of the OAU. That drama of decolonisation is captured in a recent report by the environmental activist group, Ecoterra International:
Britain also granted administration of the almost exclusively Somali-inhabited Northern Frontier District (NFD) to Kenyan nationalists despite a plebiscite demonstrating the overwhelming desire of the region’s population to join the newly formed Somali Republic. This referendum carried out in the NFD is today more and more belittled as an “informal plebiscite” but it was carried out by an official Commission of Her Majesty’s government and carried out in all the six administrative units of the Northern Frontier District, whereby only two wanted to remain with Kenya.
The report goes on to lay out some of the anti-Somali machinations of the era:
Ethiopia and Kenya concluded already in 1964 a mutual defence pact in response to what both countries perceived as a continuing threat from Somalia. This pact was renewed in 1980 and again on August 28, 1987, calling for the coordination of the armed forces of both states in the event of an attack by Somalia.
In short, the ‘Somali Question’ – and the threat that it presented in the region – was one of irredentism. For Somalis in the NFD, locked in the contradictions of the newly-decolonised states, this was a Catch-22 situation that would be replayed elsewhere on the continent, notably in Biafra. Their claims to self-determination were resisted, but they would remain unwanted, neglected and hunted down by the nationalists in Africa’s new capitals who regarded them as strangers.
This is the background to the “Shifta War,” whose echoes Rashid Jibril, a little boy in Nairobi’s Pangani, would only distantly perceive.
In 1964, the Kenyatta government sent in troops to the NFD to deal with what they described as Somali bandits – the shiftas. It was never clear what the bandits wanted, who was funding them or indeed whether this was ‘ordinary banditry’ or a political insurgency. Whatever the case, the government went into the NFD (later the North Eastern Province, the country’s second largest administrative region) as an occupying force. The region would be ruled under a state of emergency for the next 30 years.
Under emergency laws, the NFD’s residents were subject to arbitrary arrests, preventive detention and shoot-to-kill orders. To this day, Somalis travelling south are routinely stopped at Garissa, the ‘border’ town on the banks of the Tana River and gateway to southern Kenya, where they must produce a ‘pink slip’ – the identification card proving that they are Kenyan. One of the jokes among residents of the NFD/NEP is presented in the form of a question: “How is Kenya?” the NFD resident asks a visitor from the south.
Visitors only travel in the region under armed escort, reinforcing the perception of insecurity. Yet, when I interviewed the resident provincial commissioner in Garissa a few years ago, he was emphatic about the fiction of insecurity. The bandit threat, he said, was a creation of government officials in the NEP to fatten their security budgets. Insecurity was no more a problem in the Northeastern Province than it was in Nairobbery, East Africa’s crime capital. He could say this, he said, because he was Somali, the first native of the region to be appointed in this position by the Kenya government.
It is only now becoming apparent what kind of abuses took place under this regime. The Wagalla massacre of February 1984, in which an estimated 4,000 Somali men were rounded up and shot, is perhaps the most egregious of the government’s acts against the Somali community. But it is by no means the only one. This was state-conducted terrorism and its main objective was to eradicate the disease of political self-determination.
Several years prior, in 1979, Rashid Jibril’s mother emigrated to the United States. She had become friends with an African-American family in Nairobi. They helped her. As news of the Shifta War filtered in, she became worried for her two boys, their future. What kind of life would they have as Somali in Kenya, Kenyan-Somalis? Two years later, she called for her sons, living at the time with her brother in Pangani. They joined her in Washington DC.
In the three decades that Rashid spent in the US, Africa became an obsession. On his annual trips back home to Pangani, he began to notice the changes around him. At first, they were not so apparent. He had become self-conscious among his friends. His clothes and shoes, for one. But also, his American accent when he spoke English. So he stuck to Kiswahili and Sheng.
The neighbourhood was growing less mixed. The Indians were moving out. Among the Somali, it seemed as if a new religiosity was setting in: there were boys who had received scholarships to study in Saudi Arabia, who were returning and taking their positions in the mosques and who were especially disapproving of Muslim women who did not wear the veil. They were not that many, as Rashid recalls. But on each return trip, Rashid could see that they were growing in number. Rashid’s friends jokingly called them Asalaam-aleikums, for their piety.
But the ‘Somalia Somalis’ were also arriving. Settling in Eastleigh, they considered Kenya a transit point on their way to the West. Around that time, notices began appearing in the newspapers about lost Somali passports. There was a scam in the making. For the sijuis reclaiming a Somali identity was now a way out of Kenya and a Somali passport was the key.
Even in the US, among the new Kenyan immigrants, Rashid had detected a hardening of ethnic positions. He recalled attending a Kenyan concert in the late 1980s at which a prominent Kikuyu musician was performing and being asked what he was doing there.
For a sijui, negotiating the immigrant space in the diaspora was difficult. Rashid deliberately kept away from the Somali: not only was he wary of the ethnic exclusivity, he also did not like their anti-Bantu and nywele ngumu (kinky hair) prejudices, and their dismissive and derogatory way of speaking particularly against other Kenyans and East Africans.
In the US in the 1980s, Rashid threw himself into African causes. At least in the US, there was a way of being that transcended petty prejudices. Besides, there were big things at stake, big things to fight for. At Dartmouth College where Rashid studied history, he became part of the anti-apartheid campaign – the disinvestment campaign, and later, the Free Nelson Mandela campaign. Later, he moved to the West Coast working as a community organiser in San Francisco, first with HIV/AIDS NGOs in the black community, then as a teacher, and later in the black neighbourhoods of San Francisco where tenants were being forced to move to make way for the new IT millionaires.
Whatever money he was able to save up, he used to feed the wanderlust in him. He is, he says, an intrinsically nomadic soul. He can’t stay put. As a kid, he dreamed of being a long-distance truck driver. From his perch in the US, the entire continent became an accessible horizon. During the summer, he would take up his savings and pick a spot on the map: Zimbabwe, South Africa, Tanzania, wherever. If he backpacked and lived rough, US$2,000 could keep him on the road for months.
He can’t quite remember what made him finally decide to get a Kenyan ID; something about wanting to claim the continent as a pan-African, as a registered card-carrying citizen. It was some time in the mid-1990s. And so, after a decade and a half of coming and going, of roaming the continent, of dives and jazz bars in Harare and Cape Town, injera and tej in Addis, he was on the passport queue in Nyayo House, Nairobi and there was a Kenyan immigration official demanding that he prove that he was Kenyan.
He had connections, relatives in government who could easily have sorted things out for him with a phone call and a ‘please-assist-the-bearer-of-this-note’ letter. But for months he held out, every trip to Nyayo House bringing back those old echoes from his childhood in Pangani, confirming that his Kenyanness was a separate thing from his Somali identity. Before yet another immigration official one time, something unexpected happened. The man, from Western Kenya, recognized his name and asked him whether he was related to a Jibril in Kakamega. It was his uncle, Rashid said. The man beamed. “But those are our people!”
He got his ID.
Eastleigh and the rise of Somali diaspora capital
One night in December 2000, a fire razed down Garissa Lodge in Eastleigh, Nairobi, about 2km east of the city centre. Millions of shillings worth of goods were destroyed. Arson was suspected.
The biggest two national newspapers, The Nation and The Standard, gave the story prominent coverage, with on-site photos of the building and interviews with traders. The fire appeared to be part of a pattern. Nairobi had begun to establish new trading markets, ‘exhibitions’, in which cheap textiles, leather and electronics, all imported from Dubai, Istanbul, Thailand, Indonesia and China, were sold in giant markets – usually on properties with dubiously acquired trading licenses – around the city. A few months before, FREEMARK, another exhibition centre, this one started by a big-city evangelist, had been burned down in the night. The City Council would later say that the structures there had not been approved.
So there was a pattern. The police faithfully promised to investigate, a pledge that was rightly taken with a dollop of skepticism. Media investigations similarly disappeared in the pursuit of the next big story. The question of who was starting fires and why was never answered.
If the media did not know, the street did. This was a war, it was whispered, among the trading class. It pitted the old Indian mercantile elite, which had dominated the East African hinterland trade for almost a century, against a plethora of newcomers. Much of the new capital was disorganised and itinerant; Dubai-bound flights were an increasingly profitable route for Kenya Airways and others – filled with traders, mostly women, headed to buy clothes and textiles. But East Africa’s South Asians had long ago learned the value of organised ethnic capital. It was the secret to their success. Now they were being challenged from an unlikely quarter: the Somali community of Eastleigh.
“Tamarind Market had been sacked in 1991 when Mogadishu fell. A few years later, it had been reborn in ‘Little Mogadishu’, Eastleigh.”
This, then, is the long backstory of the Garissa Lodge fire, and the rise of Somali capital. But there is another worth telling.
Eastleigh has always been home to an immigrant trading community. In early colonial Nairobi, a city whose racial apartheid was successfully conducted primarily through ideas of racial hygiene and the associated fear of physical contamination – three bouts of bubonic plague had convinced the authorities of the wisdom and efficacy of such – an emergent Indian trading class had settled east of the city, on the upper edge of the dusty plains near the Nairobi River. They ran the bazaar in the heart of the city, where the first outbreaks of plague had been reported. A filthy market, scratchy with rats and bleeding open sewers, the city’s public health officials deemed that it was an innate disinterest in hygiene among Indians and Africans, rather than their own failure to institute appropriate clean-up measures, that was responsible for the plague. And so the Indians were sent to the River and the Africans to the plains, while the whites occupied the cool, forested suburbs west of the railway.
Eastleigh, then, was literally a settlement on the other side of the tracks. As racial restrictions on settlement were gradually lifted toward the end of colonial rule, the Indian traders were allowed, and could afford, to move west – to Parklands across the river, which still remains a predominantly South Asian neighbourhood. Eastleigh, with its dusty unpaved streets lined by rows of tin-roofed wooden bungalows, became home to the emerging class of the African employed – the tai tais, clerks and office workers.
Among them, however, was a small community of Somali traders. Predominantly from the old NFD, they were mostly truckers who provided the transport supply link to the Indian trading communities now scattered across the East African hinterland.
It was this community that provided the base for the avalanche of Mogadishu merchants and their families who arrived in the early 1990s when Somalia imploded. In a few short years, the population of Eastleigh, previously home to a few thousand mainly Kikuyu small traders and businesspeople, and Kenyan Somali traders, now needed to accommodate 100,000 Somalis.
At the time, Garissa Lodge was a cheap establishment frequented by Somali journeymen. Legend has it that it was built by a Swahili businessman. With the new immigrants, Eastleigh was flush with cash. The Mogadishu merchants had liquidated their assets in the twilight of Siad Barre and arrived with their pockets full. Many regarded Nairobi as a transit station on their way abroad – a notion, ironically, that was the original idea of Nairobi, the station at Mile 327 on the railway line, that accidental settlement by a river that grew as the railway engineers and labourers paused briefly to ponder how they were going to construct a line up the vertiginous Kikuyu Escarpment.
The merchants had neither the requisite papers nor the facilities to set up businesses. Many of them had already begun using Garissa Lodge as both a hotel and a market. They would put their beds against the wall during the day and turn the tiny rooms into stalls selling whatever they could get their hands on: khat, leather goods, second-hand clothes from the Gikomba Market on the eastern bank of the river. A Somali businesswoman saw an opportunity and bought the building. She kept the old name but turned over the rooms into business stalls. Which is how Garissa Lodge, the first shopping mall in Eastleigh, was born.
That was circa 1995. And then Garissa Lodge burned down. It was quickly rebuilt. It was renamed Bangkok Shopping Mall, a four-storey glitzy complex sagging with the weight of its goods, imported mainly from Bangkok. In the press of commerce, Eastleigh’s pothole-cratered streets clogged with cars, mkokoteni hand-carts, lorries, buses and matatus, their diesel thickening the air, and textiles and trinkets literally spilling into the street, Bangkok Shopping Mall is indistinguishable from the other shopping complexes surrounding it.
When it was razed in December 2000, there was only one other shopping complex. Today there are 40. There is also a crush of residential apartments, a business investment park (where the old Kenya Bus Service depot used to be; Somali investors bought the land a few years ago); countless hawala money transfer outlets; and, clustered like kiosks at a highway junction, 11 banks, including all the major local retail ones, a couple of Islamic banks and the multinationals. Most of the banks long ago adapted to Eastleigh’s 24-hour economy; they open at dawn and close well after sunset.
It was not until I read “Of Tamarind and Cosmopolitanism,” Nurrudin Farrah’s essay about the destruction of Mogadishu’s most famous market, that I understood the vision behind the transformed Eastleigh. The conversion of the little rooms in Garissa Lodge into stalls, the thousand-fold replication of that model across this new commercial district – none of this had happened arbitrarily.
Farrah describes Tamarind Market thus:
One of Mogadishu’s best-kept secrets was the shopping complex locally known as Tamarind Market. This was always abuzz with activities, its narrow alleys filled with shoppers. You could see entire families pouring into its alleys and plazas soon after siesta time, some shopping for clothes, others wishing to acquire what they could find in the way of gold or silver necklaces, many made to order. Stories abounded in which you were told that some of the shoppers came from as far as the Arabian Gulf to strike bargains, well aware that they would pay a lot more for the same items in their home countries in the Emirates or Saudi Arabia. In those days, no bride would get married without a collection of custom-made gold and silver items bought from one of the artisans there. And, for your tailoring needs, you went behind the market, where you would be fitted for your shirts, dresses, trousers, caps, jackets or a pair of leather boots, all to be had at bargain prices.
Tamarind Market had been sacked in 1991 when Mogadishu fell. A few years later, it had been reborn in ‘Little Mogadishu’, Eastleigh. What makes this incarnation so uncanny is that, like the ancient Tamarind Market, Eastleigh was now the centre of a trading system that stretched from North America to the Far East. And its market was the East African hinterland.
Eastleigh relies on four categories of goods: ex-warehouse textile and fabric from the Far East; fake leather goods, mostly handbags, shoes and jackets; gold and silver jewellery and watches; and fake designer gear and electronics. All this was now available at cut-rate bargains in Eastleigh’s maze of malls. Traders from the East African hinterland were flocking there to buy in bulk. It was cheaper than going to Dubai.
Mohammed, a tall, skinny, somewhat distracted man with the hoarse voice of a market trader who looked like he had recently recovered from a long illness, is showing me around. He had been one of the stall owners in the original Garissa Lodge. Now he was a real estate agent, representing shopping mall owners looking for new clients for their stalls.
“We were making a lot of money in those days,” says Mohammed. He had specialised in fabric. “I used to have a line in front of my shop even before I arrived. We would sell and sell. Without looking up. And then you realize it is evening. My clients would come from Rwanda, Uganda, Eastern Congo, Tanzania, Mombasa – everywhere.”
Mohammed says he would make as much as Ksh 200,000 (about $2,000) a day. In order to source his textiles cheaply, he had a cousin stationed in Java who was able to source and buy his product at ex-factory prices. That was in the late 1990s. Margins have pared down considerably since then. One of the problems with the Eastleigh model, a shopping mall manager tells me, is that everybody is doing the same thing. There is no diversity.
“We all buy the same things from the same places and sell them at the same price,” he says.
Eastleigh, then, is a giant clearing house of imported Southeast Asian goods – the cheap facsimiles of designer items in which ordinary East Africans, bred for a decade and more on second-hand items, now outfit themselves. And though this is potentially a weakness, eating into individual profits, it is precisely what makes Eastleigh so successful.
“We do volume business here,” says the shopping mall manager. “You make a small profit off one shirt. If you sell 1,000 of them, you’ll make some money.”
It is this approach that began transforming the pecking order of mercantile trade in East Africa. The South Asians had dominated it through a low volume, high mark-up model. Its logic had been an exclusive knowledge of source markets (domestically, the textile industry mostly South Asian-owned; abroad, family networks across the South Asian diaspora). But the mercantile trade in East Africa had developed at a time of African deprivation. This meant that imported goods especially had been regarded as exclusive, which in turn justified high mark-ups.
Market deregulation and liberalisation had sounded the death-knell for the South Asian model. Now, another trading diaspora operating on an entirely different sensibility, is taking over.
The anthropologist Paul Goldsmith who has closely followed the rise of Somali diaspora capital, attributes the expansion of Somali mercantilism to what he refers to as segmentary lineage – the tracing of generations-old family and clan links across Somali society. Once those links are established, individuals are bound in an obligatory system of reliance and responsibility. This honour system, aamano, is what explains, for instance, how payment of an old debt owed to a Somali man in Manchester, England becomes the responsibility of an entire clan, wherever its members are to be found. In a sense then, it is a kind of sovereign debt: it must be eventually repaid.
Under the pseudo-socialist rule of Siad Barre in which his Marehan clan was unduly favoured, it can be said that segmentary lineage fuelled complex antagonisms across Somali society. In the post-Barre diaspora, it is paradoxically this honour system that has galvanized Somali capital and invested savings and wealth along communal lines.
Perhaps one of the most striking examples of the honour system playing out in the diaspora is the case of Al Barakat. Established in Mogadishu in the mid-1980s as a hawala money transfer operation, it had a turnover of $140 million a year by the turn of the century and was operating in more than 40 countries. Then, after the 9/11 terror attacks, it was closed down by US authorities. Its financial network was suspected of being one of the principal channels of Al Qaeda money. No links between Al Barakat and Al Qaeda were ever established. Regardless of the fact that its finances were not re-insured, Al Barakat’s owners spent the next seven years tracing and repaying anybody whose money had been stuck in the system when the hawala bank was forced to close down.
Osman Moalim, a businessman and Mogadishu-based political activist, had $5000 held up in Al Barakat. He was finally repaid in 2007. Today, Al Barakat has diversified into the mobile telco industry. Ormud, its telecommunications arm, is the biggest service provider in Mogadishu.
A large chunk of the new Somali capital has come from war profiteering. Moalim, whose father was a major politician in Mogadishu in the immediate post-indepedence era and later a vocal critic of Siad Barre, was the only member of his family to remain behind when Somalia imploded in 1991. The last of his siblings left in 1988. He remained and witnessed the horrific drama of the civil war from the capital, its epicenter.
The civil war was accompanied by famine. Moalim, who had grown up alienated from the clan system, found himself in a part of Mogadishu cut off from his relatives.
“I decided to use my little knowledge of medicine to try and save people,” he says. He has a degree in biology. “We took over the abandoned houses of the rich and converted them into makeshift clinics.”
In the midst of it all, the aid industry was arriving with food and drugs. With no knowledge of the local factionalisms, they depended on local militias to distribute aid. In the process, the militias-turned-merchants made a killing. There were other sub-contractors: the US company Kellog Brown and Root was a major sub-contractor for UNOSOM, says Moalim. Their philosophy was “to keep things moving” regardless of the obvious wastage and pilfering that was taking place.
This was good for the militias. And with the monies generated, they invested in Eastleigh. At first, much of the money went into the khat business. There were 10-15 flights every day leaving Nairobi for Mogadishu and Djibouti. The operators depended on aamano to guarantee shipments. Profits were huge. And with the khat market investor-saturated, these profits were increasingly turned to other trade.
It is this rapid evolution and the constant re-deployments of Somali capital that has baffled many outsiders. When the Kenyan government recently announced that it was embarking on a property audit in Nairobi, the intent was obvious: to establish a link between piracy and the expansion of Somali capital. Ignorant and more than a little envious of the sudden growth of Somali businesses, the Kenyan establishment suspected that much of the money coming into Eastleigh and dispersing into Nairobi real estate, as well as other sectors, was laundered pirate money. None of the studies and investigations subsequently conducted has confirmed such a link.
There can be little doubt that a certain amount of proceeds of piracy have also been invested in Kenya and other places in East Africa. Any audit, however, will have a difficult time proving that piracy is the bedrock of Somali capital’s expansionism. By this year, piracy proceeds amounted to less than $100 million. This is a fraction of what is generated across the spectrum of Somali business activities in Kenya. Moreover, it simply cannot explain the expansion of Somali capital before the boom in piracy ransoms began last year.
Furthermore, with stable Western diasporas, many individual Somalis living on the dole in Europe and the US or having generally prospered in the diaspora, regard Eastleigh not only as a centre through which to route remittance money, but also as an investment centre. It is cheaper, say, to buy a building in Eastleigh than in St Paul, Minnesota or Toronto. There is also a faster return on investment in Kenya.
What makes Kenya attractive is its legal porousness. With few restrictions on capital inflows, little scrutiny of imports and few requirements that could restrict an investor in the money-transfer business, Somalis (legal and illegal) regard the country as a comfortable investment destination.
More than anything, then, Somali capital flowing through the hawala system allows it to be more mobile than other forms of ethnic capital. And because it is communal, it can be quickly mobilised to take advantage of new investment and trading opportunities. Similarly, because Somalis rely on family networks for their labour, they are able to keep recurrent costs at a minimum while extending a trading network across the diaspora. Today, remittances to Somalia are estimated at $2 billion. This, more than anything else, explains the growth of commerce in Eastleigh.
None of the shopping malls in Eastleigh are individually owned, I am informed by the shopping mall manager. People, mostly in the diaspora, pool their resources and make an acquisition and share out the profits.
“Our people in the West now no longer feel obligated to support family in Somalia by constantly sending money,” says Osman Moalim. Instead, they have created investment vehicles in which relatives can make a legitimate living.
Moalim attributes the rise of Somali capital to a simple principle: “We are risk takers. We don’t fear new opportunities or new places.”