Puntland is surpassing the rest of Somalia.

[Zak12]

It’s not about the land but the people PL has very productive people go getters

All Somalis are productive if the private sector is any indication. Even outside of Somalia, communities in Kenya and Tanzania are doing well.

 

[Idilinaa]

I hate to be the contrarian here but I found some interesting posts a few years ago that says the opposite. @Idilinaa might want to check it out too.

I don't think its accurate to say any one region blows everyone else out of the water, rather its every region doing well with some like Puntland doing slightly better than the rest.

She pointed out that Puntland has a lower poverty rate than Kenya and Ethiopia despite both countries having bigger GDPs. Quite the astounding feat given Puntland doesn't get any foreign aid and its land is more arid than either countries.



As for GDP per capita, others have pointed out before that Somalia has yet to get a rebase so Puntland's current GDP per capita figure may not be true and is likely much higher. Wouldn't be surprised if it was on par with Ethiopia to be honest.

I remember when i shared that 2016/17 report by the world bank/UN . I later realized they measured the poverty rate in terms how many people have access to basic services, like electricity, water, and education.

When you look at it realistically, there's no major wealth gap between Somalia’s regions. Money flows across different areas, and businesses operate trans-regionally in a decentralized, networked manner. There isn’t a single region hoarding wealth at the exclusion of the rest , and you don't see stark imbalances in services either, except in cases where access is disrupted by political conflict or environmental issues.

For example, poverty is heavily concentrated among IDPs (Internally Displaced Persons), not because their regions are inherently poorer, but because displacement strips people of access to resources.

I'd have to see the budget for banadiir and somaliland to make an accurate estimate. But this seems like an insanely highly difference. Does puntland really have a budget higher than all the other federal member states combined ? Where is this money coming from ? I know it can't be tax since while puntland is somehwat above the others the difference isn't large enough to explain this.

As for Puntland’s budget , it’s a good question. Is it really bigger than all the other federal states combined? It sounds wild, but it’s not impossible when you understand the broader context.

Somalia overall has an extremely low tax-to-GDP ratio, around 1.2% to 2% , and that's likely "overstated" if you factor in how GDP is grossly underestimated. To compare: the U.S. has a 25% tax-to-GDP ratio, and Norway sits around 41%. Even 10% is considered low globally , Somalia is far beneath that.

Now, Puntland probably sits a little higher than the national average because it’s better at mobilizing domestic revenue , but it’s still low compared to other countries. According to a WardheerNews article (linked below ), Puntland's tax revenue is about 3% of its GDP , still way under the 17% average for developing African countries like Kenya and Ethiopia.

Rebuttal- Puntland economy: Key underlying challenges of budget execution and ways forward - WardheerNews

The opinion piece on Puntland Economy published on WardheerNews, August 2, 2021 by a Abdullahi A. Muse (Sanco)’ with ooh and surprise about the author’s misrepresentation of the current financial performance and significant reforms achieved in Puntland under the new leadership and administration

wardheernews.com

Mobilizing revenue is a cornerstone of the state’s progress and citizen’s wellbeing. The author’s assertion on over-taxation is based on false premises because the Puntland’s tax revenue remains just over 3 percent of the GDP. This figure is far below the average tax to GDP ratio (over 17 percent of the GDP) of developing African countries including neighboring countries such as Kenya and Ethiopia.

The current Minister of Finance is university graduate with over 23 years of managerial experiences in public finance management. Under his leadership, the government revenue increased by 5-7% and expenditure reduced by 5 percent in the recent years, these gains have significantly contributed to investments, security and stability in Puntland. The Minister is a competent leader devoted to public services and the betterment of his fellow Puntlanders.

To overcome these weakness, the current government has taken a series of revenue mobilization actions including ( but not limited to) streamlining the tax laws; tackling the problem of the hard-to-tax informal sector of the economy; imposing and collecting income taxes on wages and salaries in both the public, private, increasing tax compliance by large companies; and levying departure fees and other sources of nontax revenue. Due to the successful leadership, the gross annual revenue for Puntland in 2020 has risen to US$ 342 million,

For most federal member states (except Banadir Regional Administration, which is recieves more funding through business and income taxes in Mogadishu), their primary revenue sources are customs duties (taxes on goods moving in and out), fees from public services (transportation, healthcare, education, licensing), excise and sales taxes, land sales, and some limited property taxes.

But even then, all of this barely scratches the surface of what could potentially be collected. Somalia’s economy is still largely privatized and informal, meaning a massive amount of wealth circulates outside government oversight or taxation.

That's why I actually respect Puntland’s push to strengthen its financial systems and diversify revenue sources , it shows real initiative to build a sustainable economic future rather than rely on foreign grants.

 

[Midas]

I remember when i shared that 2016/17 report by the world bank/UN . I later realized they measured the poverty rate in terms how many people have access to basic services, like electricity, water, and education.

When you look at it realistically, there's no major wealth gap between Somalia’s regions. Money flows across different areas, and businesses operate trans-regionally in a decentralized, networked manner. There isn’t a single region hoarding wealth at the exclusion of the rest , and you don't see stark imbalances in services either, except in cases where access is disrupted by political conflict or environmental issues.

For example, poverty is heavily concentrated among IDPs (Internally Displaced Persons), not because their regions are inherently poorer, but because displacement strips people of access to resources.




As for Puntland’s budget , it’s a good question. Is it really bigger than all the other federal states combined? It sounds wild, but it’s not impossible when you understand the broader context.

Somalia overall has an extremely low tax-to-GDP ratio, around 1.2% to 2% , and that's likely "overstated" if you factor in how GDP is grossly underestimated. To compare: the U.S. has a 25% tax-to-GDP ratio, and Norway sits around 41%. Even 10% is considered low globally , Somalia is far beneath that.

Now, Puntland probably sits a little higher than the national average because it’s better at mobilizing domestic revenue , but it’s still low compared to other countries. According to a WardheerNews article (linked below ), Puntland's tax revenue is about 3% of its GDP , still way under the 17% average for developing African countries like Kenya and Ethiopia.

Rebuttal- Puntland economy: Key underlying challenges of budget execution and ways forward - WardheerNews

The opinion piece on Puntland Economy published on WardheerNews, August 2, 2021 by a Abdullahi A. Muse (Sanco)’ with ooh and surprise about the author’s misrepresentation of the current financial performance and significant reforms achieved in Puntland under the new leadership and administration

wardheernews.com

For most federal member states (except Banadir Regional Administration, which is recieves more funding through business and income taxes in Mogadishu), their primary revenue sources are customs duties (taxes on goods moving in and out), fees from public services (transportation, healthcare, education, licensing), excise and sales taxes, land sales, and some limited property taxes.

But even then, all of this barely scratches the surface of what could potentially be collected. Somalia’s economy is still largely privatized and informal, meaning a massive amount of wealth circulates outside government oversight or taxation.

That's why I actually respect Puntland’s push to strengthen its financial systems and diversify revenue sources , it shows real initiative to build a sustainable economic future rather than rely on foreign grants.

Your point about how thr wealth differences not being immense is why I'm skeptical about the puntland budget.

If puntland's budget was that much higher than all the rest I would expect the infrastructure and other aspects of living standards to be on a fundamentally different level. Especially since puntland is the most sparsely inhabited part of the country.

 

[Idilinaa]

Your point about how thr wealth differences not being immense is why I'm skeptical about the puntland budget.

If puntland's budget was that much higher than all the rest I would expect the infrastructure and other aspects of living standards to be on a fundamentally different level. Especially since puntland is the most sparsely inhabited part of the country.

If they manage somehow one day to measure each regions economic activity which includes the informal and fully private sector. North West(Somaliland) and Benadir-Hirshabelle would be wealthier, because they have a larger population and larger cities and towns , Berbera and Mogadishu are busier ports than Bosaso for example as well so higher seaborn trade volume.

The difference is in domestic revenue mobilization not how much wealth each region has, say Puntland has 10 billion circulating in it's economy yearly and the government only managed to capture 300 million through taxation or public , ownership etc. Where as Banadir Regional Admin has 100 billion circulating and they only captured 100 million that's not reflective of the wealth difference between the two. Just as a hypothetical.

Most infrastructure and development is privately funded by property owners, businesses, diaspora and community driven banks.

Unlike other regional states in Somalia where most of the budget goes to pay salaries and has poorer collection of domestic revenue , Puntland government seems to partake in more Public-Private partnerships and partially fund development and services.

This is a report on the first quarter of 2024. Go to page 16 you see a break down 90% of the revenue came from taxation. It shows that Puntland collects the most money, spends the most and has a larger budget surplus.

https://hespi.org/wp-content/uploads/2024/07/Somalia_Budget_Policy_Brief_2024.pdf

5. Federal Member States Financial Operations

During the first quarter of 2024, the total fiscal receipts of the State of Puntland amounted to US$26.7 million, the highest among the Federal Member States. This is followed by Jubbaland, with a total revenue of US$10.1 million. Galmudug recorded a total fiscal receipt of US$4.7 million, while Southwest and HirShabelle recorded total revenues of US$3.3 million and US$2.7 million, respectively.

On the expenditure side, the Puntland State of Somalia spent US$24.3 million, the highest expenditure among the Federal Member States, with a financing surplus of US$2.4 million. The spending of Jubaland State amounted to US$11.5 million, with a financing gap of US$1.4 million, followed by Galmudug, with a total expenditure of US$5.2 million and a fiscal gap of US$0.5 million. Southwest and HirShabelle spent US$3.4 million and US$3 million, with a financing gap of US$0.1 million and US$0.9 million, respectively.

It also says what i said before, they get most of their revenue from taxing a narrow amount of international trade.

As a percentage of GDP, the Revenue mobilized by the FGS remained extremely low at 2.4 percent in 2023. Domestic Revenue is currently mobilized from a narrow base, mostly international trade duties, contributing over 80 percent of the total.

 

[Cumar Cowl]

Why you claim multiple years but only show a report from 2017?

Trying to cheat at the poverty olypmics is new low for Puntland.

Check out the 2023 report for yourself the results speak for themselves PL is superior to SL.

 

[Itsnotthateasy]

Check out the 2023 report for yourself the results speak for themselves PL is superior to SL.

You are the one who made the claim, you have to provide the data or withdraw the claim.