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Terror funding: Kenya warns of informal money sources

Friday October 25 2019

Members of Al-Shabaab at an undisclosed location in Somalia. PHOTO | FILE | AFP

Kenya is warning the region and allies not to “step down” from war on violent extremism, and instead target informal sources of finances for groups like Al-Shabaab, who have managed to subsist despite military losses.

A senior Kenyan diplomat told an audience in London, that despite the visible crackdown on terror merchants, some like Al-Shabaab are thriving because authorities have not cut off informal channels of fundraising.


“The military means must be maintained and escalated. This is necessary but insufficient,” Mr Manoah Esipisu, the Kenyan High Commissioner to the UK said.

He added: “Rather than focus so exclusively on countering terrorism financing measures in the formal banking and money transfer systems, we will need to fully deal with cash-based financing in areas that terrorists operate.”

Mr Esipisu spoke during a workshop the International Institute for Strategic Studies, a British research institution that focuses on international affairs such as counter-terrorism measures.


At hand was a debate on whether military might could eliminate the group.

Kenya, Ethiopia, Burundi, Uganda, Djibouti and Ethiopia have contributed troops to African Union Mission in Somalia (Amisom), which is backed by the UN and has been a combat force since 2007.

The militant group has, however, been able to raise its tempo attacks recently inside Somalia, attacking installations using suicide bombers. In addition, the group has been able to recruit foreign fighters who are able to launch attacks in neighbouring countries like Kenya.

Part of the problem, the Kenyan envoy argued, has been failure to focus on where Shabaab get their money. A recent report by the Voice of America’s Somali service indicated the group had infiltrated even government offices, gathering their own intelligence to counter government efforts. The group, the report said, was also collecting ‘taxes’ from local businesspeople, often through extortion and paid in cash.


“Regional and international partners must come together with the federal and regional governments of Somalia to design and implement a framework for combatting Al-Shabaab’s financing using strong Joint Investigation Teams linked to effective prosecution and incarceration in Somalia.

“These teams must also take aim at its illicit taxation and protection rackets of thousands of businesses and many of the humanitarian organisations in Somalia.

Kenya had earlier this year fronted tougher proposals to the UN, which could have elevated Shabaab to the same league as ISIS, Taliban and al-Qaeda and effectively lock out humanitarian support in areas the groups control. The proposal was vetoed by the US after pressure from humanitarian lobbies, but critics charge relief organisations have been part of the problem by paying illegal taxes to Al-Shabaab or providing rations to the militants as a passage to work in those areas.

“We will need the entire sector to be more transparent and supported in minimising taxation by terrorist groups. To not do this, and to invite the terrorist groups to make headline grabbing attacks, will eventually lead to the humanitarian sector being publicly accused of being a source of terrorism.”


Amisom is supposed to exit Somalia gradually from next year leaving the focus on existing Somali security agencies to deal with the Shabaab.

Mr Esipisu said that while military efforts have weakened the group, Somalia will also need working institutions to deter new members from joining the group.

“The military success of Al-Shabaab is far from assured: national and regional militaries, backed by Amisom and global partners such as the United States among others, have dealt it repeated defeats on the battlefield, and we can look forward to more.”

“Its political and ideological assault, however, reaches wider than its military capability. If it aligns with other political and ideological interests, particularly the expansionist or irredentist kinds, we will find ourselves dealing with a longer-term crisis that includes economic failure in Somalia and in areas exposed to the group’s operatives.”