The Impacts of Private Sector on Economic Development of Somalia A Case Study of Private Sectors in Wadajir District

ABSTRACT 

The research aimed at assessing the impacts of private sector on economic development of Somalia, Wadajir district, Banadir region as a case study. Both qualitative and quantitative techniques were used .The qualitative techniques was presented by use of tables and converted to percentages according to the themes, the data collection method used include questionnaires, Documentary view and the data was descriptive in nature. The objective of the study was to examine the major effects of private sector on economic development of Somalia. It aimed at establishing the existing efforts by relevant views towards the private sector. The General population of the District was estimated 125,031 the research population was 150 and the sample size was 108 respondents. However, the private sector in Somalia has shown exceptional recovery and adoptability in the relevant circumstances of statelessness. Today, the entire Somali economy, including sectors that were formerly under the state control -healthy care delivery, public education, veterinary service, telecommunications, electric power, and water supplies, has been Privatized Due to unfavorable conditions of statelessness, there is no any public sector working in Somalia; all these private sectors are operating at minimum capacity, the business community can not make investment at present. One of the imminent features of Somalia's present day economy is an outstanding of deregulated free market commerce, but under the absence of governmental regulatory body this led that many of the services to their customers substandard and hazardous to the wellbeing and the general healthy of the community .Under this circumstance of statelessness and civil conflict, the local business community contrived to jump-start local economy. They opened new private enterprises and restored old ones. The finding of this study revealed that private sector has a great impact on economic development of Somalia; therefore the study agreed that private sector increases employment opportunities, business skills, infrastructural development, and poverty eradication. Meanwhile Most the study revealed that problems attributed the violent nature of the public sector today are over consumption of government funds, corruption programs, and ignorance among the society which was found to be the major cause of unemployment. Therefore the findings of this study agreed that private sectors can be considered as the only way out of the all problems faced and as a major tool in the economic development of Somalia, since the sectors are managed by private ownership and government intervention only comes in to the rescue incase of poor administration. In spite of this tangible economic progress in recent years in Somalia the challenges are hard to overcome or deal with and many to list because there is no national economic planning or supervision.

TABLE OF CONTENTS

TITILE PAGE .................................................................................................................................................... II

DECLARATION .............................................................................................................................................. II

APPROVAL .................................................................................................................................................... ill

DEDICATION ................................................................................................................................................. IV

ACKNOWLEDGEMENTS .............................................................................................................................. V

LIST OFT ABLES ........................................................................................................................................... VI

TABLE OF FIGURES ................................................................................................................................... VII

LIST OF ACRONYMS ................................................................................................................................. VIII

TABLE OF CONTENTS ................................................................................................................................. IX

ABSTRACT .................................................................................................................................................. XII

CHAPTER ONE: INTRODUCTION .............................................................................................................. 1

l. 0 Introduction .................................................................................................................................................. l

1.1 Background To The Study ............................................................................................................................ 1

1.2 Statement OfTJ1e Problem. ........................................................................................................................... 3

1.3 Purpose Of The Study .................................................................................................................................. 3

1. 4 Objectives Of The Study .............................................................................................................................. 4

I. 5 Research Questions ...................................................................................................................................... 4

1.6 Scope Of The Study ..................................................................................................................................... 4

I. 7 Significances Of The Study .......................................................................................................................... 5

CHAPTER TWO: LITERATURE REVIEW .................................................................. 0 ............ 6

2.0 Introduction .................................................................................................................................................. 6

2.1 Theoretical Review ...................................................................................................................................... 6

2.2 Conceptual Frame Work. .............................................................................................................................. 7 

2.3 Review of related literatures ......................................................................................................................... 8

2.3.1 Current State Of The Private Sector Development ...................................................................................... 8

2.3.2 Economic Development. .......................................................................................................................... 10

2.4-Factors OfDevelopment.. ........................................................................................................................... 11

2.4.1 Natural Resources, Land And Climate ..................................................................................................... 11

2.4.2 Arid And Semi Arid OfLand: .................................................................................................................. 12

2.4.3 Energy Availability ................................................................................................................................. 12

2.5 Business And Social Structure .................................................................................................................... 13

2.5. l The Market And Social Relations ............................................................................................................ 13

2.5.2 Social Regulation Of The Market ............................................................................................................. 14

2.6 Business And Politics In Mogadishu ........................................................................................................... 15

2.7 The New Business Class ............................................................................................................................. 16

2.7.1 The Re-Creation Of A Business ............................................................................................................... 16

2.8 The Business Sector In Shaping Economic Development.. .......................................................................... 19

2. 9 problems faced by the Somali private sectors .............................................................................................. 20

2. 9.1 Economic Instability In Somalia .............................................................................................................. 22

CHAPTER THREE: METHODOLOGY ...................................................................................................... 24

3.0 Jntroduction ................................................................................................................................................ 24

3.1 Research Design ......................................................................................................................................... 24

3.2 Research Population ................................................................................................................................... 24

3.3 Sample And Sample Procedure ................................................................................................................... 25

3.4 Research Instrwnent ................................................................................................................................. 256

3.4.1 Questionnaires ....................................................................................................................................... 256

3.4.2 Ducumentmy reviews ............................................................................................................................ 256

3.5 Validity OfT!tc Research Instruments ........................................................................................................ 27

3.6 Reliability Of The lnstruments .................................................................................................................... 27

3. 7 Data Processing .......................................................................................................................................... 28

3. 8 Limitations Of The Study ........................................................................................................................... 28

CHAPTER FOUR: DATA PRESENTATION, INTERPRETATOIN AND ANALYSIS ............................ 29

4.0 Introduction ................................................................................................................................................ 29

4 .1 Background information of the respondncts ................................................................................................ 29

4.2 Research Question One: in which areas has private sector developed? ......................................................... 32

4.3 Research questin Two: what are the problems facing Somali private sector development? ........................... 32

4.4 Research Question Three: how is current state Somalia private sector? ........................................................ 32

CHAPTER FIVE: DISCUSION, CONCLUSIONS AND RECOMMENDATIONS .................................... 42

5.0 Introduction ................................................................................................................................................ 42

5.1 Discussion .................................................................................................................................................. 42

5.2 Conclusions ................................................................................................................................................ 4 7

5.3 Recomendations ......................................................................................................................................... 47

5.4 Suggestions of further reading .................................................................................................................... 53

RE FE REN CES .............................................................................................................................................. 57

APPENDIXES ................................................................................................................................................. 57

APPENDIX A INSTRUMENTS ...................................................................................................................... 57

APPENDIX B CALCULATE OF CONTENTS OF VALIDITY INDEX ( CVI) ............................................... 65

APPENDIX C INTRODUCTION LETTER ..................................................................................................... 67