Somalia-Export of Labor

Somalia was an exporter of labor to other members of the League of Arab States (Arab League), and Somali citizens received remittances from these workers. These remittances constituted the largest source of foreign exchange in the economy. Based on an assumption of 165,000 Somali overseas workers, with an average annual wage of US$6,150, one-third of which was being remitted, one economist has calculated that more than US$330 million was being remitted annually. This figure represented fifteen times the sum of Somalia-based yearly wages and nearly 40 percent of total GNP, including remittances. The official remittance figure was US$30 million, the amount channeled through banks. Most unofficial remittances--in the form of foreign exchange and household goods and appliances sent home from abroad--went to urban traders. This fact explains the apparent abundance of supplies in Somali cities, which, based on the foreign exchange estimates from official sources, would not have been possible. A large portion of the remittances went to supply arms to the rural guerrillas who toppled the government in January 1991 (see Sources of Opposition , ch. 5).