The Somali Congress of Trade Unions (SOCOTU) has voiced serious concerns regarding the escalating inflation that continues to impact the nation. The inflation surge has significantly affected essential services, including housing rent, electricity, and water, compounding the daily struggles faced by Somali workers and the general population.
One of the most pressing issues highlighted by SOCOTU is the severe lack of government services. Public transportation is notably absent, forcing people to rely on expensive alternatives like Moto Bajaj, which costs between one and one and a half dollars per ride. For a population with already limited financial resources, these costs are untenable. The salaries of government and private sector workers remain dismally low, failing to keep pace with the rising cost of living.
SOCOTU fears the economic disparity will lead to a deeply divided society, where the middle class will disappear, leaving only a small wealthy upper class and a significantly larger lower class struggling for survival. The alarming trend of Somali workers migrating to neighboring countries in search of a more affordable lifestyle underscores the gravity of the situation.
The inflation rate in Somalia has reached unprecedented levels. The nation, highly vulnerable to climate change, suffers from frequent droughts, floods, cyclones, and dust storms. The 2022 drought, for instance, resulted in widespread crop and livestock failures, exacerbating food insecurity, water scarcity, and loss of livelihoods. This calamity reduced real GDP growth and displaced approximately 7.8 million people. Despite receiving $280 million annually in climate finance over 2016–20, Somalia faces an average financing gap of $4.42 billion per year for 2020–30, severely hindering its ability to build climate resilience.
According to the latest report from the Somali National Bureau of Statistics, the Consumer Price Index (CPI) for April 2024 was 148.42, up from 145.34 in March 2024. This represents a significant inflation rate over the twelve-month period from April 2023 to April 2024, highlighting the rapid increase in living costs.
SOCOTU emphasizes that the labor sector, primarily composed of low- and middle-income workers, is under immense pressure due to stagnant wages amidst soaring inflation. Without adequate salary adjustments, workers’ purchasing power continues to diminish, pushing more families towards poverty.
In light of these challenges, SOCOTU calls for urgent interventions to address the inflation crisis. These include measures to increase workers’ wages, improve access to essential services, and enhance public transportation options. Furthermore, there is a critical need for increased climate finance to help Somalia build resilience against the adverse effects of climate change.
SOCOTU urges the government, private sector, and international community to take immediate and coordinated action to alleviate the economic hardships facing Somali workers and to prevent the erosion of the middle class. Only through comprehensive and sustained efforts can Somalia hope to overcome the current inflation crisis and ensure a stable and prosperous future for all its citizens.
Kind Regards,
Salad Abdullahi Omar
Head of Informal Economy Department
