ISSUE 40 October 2008

Humanitarian Exchange Magazine

Conflict, economic crisis and drought: a humanitarian emergency out of control

by Cindy Holleman, FSAU/FAO

The humanitarian disaster unfolding in Somalia is one of the worst in world. The scale and magnitude of the crisis, and the speed at which it is deteriorating, is alarming and profound. Within the first six months of this year, the number of people requiring emergency livelihood and humanitarian support increased by 40%, from 1.8 million to 2.6m, or 35% of the population. As the situation deteriorates, this could rise to 3.5m by the end of the year – more than half the total population. The level of human suffering and deprivation is shocking. One in six children under the age of five is acutely malnourished, a number that is continuing to increase. Rates of acute malnutrition among the rural population in most of southern and central Somalia are above 15%, which is the internationally recognised emergency threshold, and half of the nutrition surveys conducted in the last six months reported rates above 20%. The number of severely malnourished children is increasing in many of the main towns in southern and central Somalia, as well as among internally displaced populations in the north, where nutrition rates are normally low and relatively stable.

One of the main factors driving this crisis – civil insecurity – is increasing and is currently the worst the country has seen since the collapse of the government in the early 1990s. Direct effects include human rights abuses, violence, killings and displacement (more than a million people have been internally displaced due to conflict in the last year). Meanwhile, the indirect effects of the conflict are creating an economic crisis which is having a wider and more devastating impact on the broader population and the humanitarian situation. Economic activities, trade and transportation networks are disrupted and the uncontrolled and excessive printing of currency, in large part to fund the conflict, has meant that Somali Shillings have flooded the markets, rapidly increasing the money supply, sending the value of the Shilling into freefall and causing hyperinflation, with price increases of between 200% and 700% within just six months. Rural and urban populations, not directly affected by conflict, are now struggling to meet basic food needs. In particular, the urban and rural poor and IDPs are dependent on the market and have limited capacity to cope with sudden and dramatic prices increases. For pastoralists already struggling to cope with an ongoing drought in many parts of the country, the added economic shocks of food and water price hikes are leading to rapid asset losses, and a deterioration in food access and nutritional status.

The economic crisis

The continued and sharp devaluation of the Somali shilling has affected all population groups in the south, centre and north-east, where the Somali Shilling is the main currency. Since January 2007, the average exchange rate against the US dollar for the Sorghum Belt, Shabelle, Juba, the north-east and central regions has increased from SoSh13,600 to SoSh35,900, or 165% (see Figure 1). In Mogadishu, the Shilling depreciated by some 50% between January and July.

Partly as a result of this rapid depreciation, imported food and non-food commodity prices have increased dramatically (as shown in Figure 2), exacerbated by high global food and fuel prices. The price of imported rice, the main staple food for most of the population covering roughly 60% of the country’s total cereal requirements, more than tripled between January and July throughout the north-east, centre and south, from an average of SoSh14,570/kg to SoSh46,450 in July. Other imported food commodities, including basic items like vegetable oil and sugar, have also increased significantly in price.

Record price rises mean that imported cereals are beyond the reach of most poor urban and rural households, and households are switching to cheaper locally produced maize and sorghum. Even in a good production year, however, local cereal production cannot absorb any significant increases in demand. In the current context the situation is even worse, as stocks are at their lowest level in more than 15 years. Not only has the country faced three consecutive years of below-normal cereal production, but two of the last three years have seen the lowest levels of production in more than a decade. The main cereal harvest in July and August was again expected to be significantly below normal levels.

Increased demand and low availability have seen locally produced sorghum and maize prices triple in six months to July (see Figure 3). In the main sorghum-producing area in the south, the ‘Sorghum Belt’, sorghum prices increased on average from SoSh4,000/kg to SoSh8,000/kg. Likewise, in the main maize production area of the Shabelle region, maize prices more than tripled, from SoSh4,700/kg in January to SoSh15,000/kg by July. Traders are queuing to purchase directly from farms for transport to cereal-deficit areas in the south, and as far away as the central and northern regions. High fuel and transportation costs mean that cereal prices are even higher once they reach their destination. In much of the central and northern regions, the price of locally produced sorghum is now as high as or higher than imported rice prices in normal times. Local cereal supplies are heavily constrained, and in many areas in the north local cereal is simply not available.

Food prices, both locally produced and imported, are continuing to increase, are two to three times higher than five-year average prices, are at record historic levels and are still climbing. As a result, more and more people, from both rural and – for the first time – urban areas, are falling into Acute Food and Livelihood Crisis (AFLC) and Humanitarian Emergency (HE). Poor and middling households are becoming severely indebted, and are adopting extreme coping strategies, including skipping meals, begging, selling productive assets and out-migration (‘keenan’). An estimated 600,000 urban poor in main towns and rural settlements are facing conditions of Acute Food and Livelihood Crisis and Humanitarian Emergency, according to a nationwide Rapid Emergency Urban Assessment conducted by the Food Security Analysis Unit (FSAU) in April 2008. This represents 21% of the total urban population.

The urban poor are adopting a number of different coping strategies to deal with this crisis, including reducing their overall expenditure on food by cutting down on the amount they buy (cereal, sugar and oils), switching to cheaper cereals (from commercial imports of rice to locally produced sorghum) and lower-quality cereals and skipping meals, all of which is contributing to lower intake of kilocalories. They are also taking their children out of school and reducing their purchases of medicines, as well as reducing the amount of soap, kerosene and firewood/charcoal they purchase. The survey results also indicate that many of the urban poor are searching for new opportunities for wage labour and self-employment (charcoal sales), often involving younger family members, as well as increased remittances, loans and gifts.

The impact of the drought

There is also a deepening drought in parts of southern and central Somalia (Bakool, Hiran and central regions), which is now spreading into the north. The impact of the drought on pastoralists is exacerbated by the compounding impact of food price increases, conflict and displacement, pushing more into crisis. Recent nutrition reports indicate a doubling of the caseload of severely malnourished children in feeding centres between May and July 2008 in Dhusamareb, Galgadud. Severe water and pasture shortages have led to the migration of large numbers of livestock and people – affecting up to 50% of rural settlements – who are now concentrating around permanent water sources. In the central regions, most of the remaining boreholes are being pushed beyond capacity due to a lack of maintenance and generators. Meanwhile, dramatic rises in petrol prices have significantly increased water prices due to increased costs associated with pumping and trucking water. Water prices are now between 300% and 1,000% higher than normal levels (SoSh30,000–100,000 per 200lt barrel, compared to SoSh10,000 normally).

Livestock body condition, productivity and value have plummeted, while pack animals and small ruminants are dying. Pastoralists have no export-quality animals left, and are resorting to selling breeding animals in a desperate attempt to meet skyrocketing water and food prices. Buying on credit is limited due to levels of household debt three to six times greater than normal. As the next rains are not expected before mid-October, and food prices are expected to continue to increase over the coming months, the situation will deteriorate further without adequate humanitarian and livelihood support interventions.

Prospects

All indications are that the key factors driving this humanitarian disaster – increased civil insecurity, hyperinflation and drought – will worsen over the coming months. There is an urgent need to scale-up integrated emergency livelihood and humanitarian assistance to ensure that the growing number of people in need of assistance receive life- and livelihood-saving support, and to prevent a slide into humanitarian catastrophe. Currently, humanitarian access is insufficient to meet growing humanitarian needs. Killings and abductions of aid workers, increased troop and militia activity and threats to the humanitarian community make humanitarian response and interventions extremely difficult, and have led to the reduction and even suspension of some humanitarian operations. Humanitarian access is decreasing at a time when needs are not being met, and are even increasing.

The escalating conflict, civil insecurity and instability in Somalia are not only directly leading to human suffering, in terms of human rights abuses, violence, killings and displacement, but are fuelling an economic crisis which is beginning to have a wider and devastating impact on the broader population, threatening to plunge the country into a humanitarian catastrophe from which it will be difficult to recover.

Cindy Holleman is Chief Technical Advisor for the Food Security Analysis Unit of Somalia (FSAU/FAO). She would like to thank the team of dedicated food security and nutrition analysts of the FSAU who collected and analysed the information on which this article is based. This includes a team of 29 Somali professionals based in Somalia, who work in extremely dangerous conditions to deliver quality information and analysis. The author takes full responsibility for views contained in this article, and any errors therein.

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