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Finance Conference SOMALILAND BANKING AND FINANCE CONFERENCE 2019 REPORT www.somalilandbafc.com “Promoting Banking and Financial Sector: Connecting People to Banking and Financial Services” Table of Contents Introduction / Background �������������������������������������������������������������������������������������������� 5 Executive Summary ������������������������������������������������������������������������������������������������������ 7 The specific objectives of the conference were: ������������������������������������������������������������ 8 A. Conference Inputs and Discussions �������������������������������������������������������������������������� 9 Opening of the Conference ��������������������������������������������������������������������������������������������������������� 9 The Governor of Central Bank ������������������������������������������������������������������������������������������������10 Minister of Finance Development ������������������������������������������������������������������������������������������10 Minister of Trade Industry and Tourism �������������������������������������������������������������������������������11 Minster of Investment Promotion ������������������������������������������������������������������������������������������11 B�..... Plenary Sessions ����������������������������������������������������������������������������������������������� 12 1�Access to Banking Services ��������������������������������������������������������������������������������������������������12 2�Access to Insurance Services ����������������������������������������������������������������������������������������������16 3� The Fintech revolution ���������������������������������������������������������������������������������������������������������19 C� Other Presentations ����������������������������������������������������������������������������������������������� 25 Fighting Financial Crimes: ������������������������������������������������������������������������������������������ 25 D.Closing of the Conference ���������������������������������������������������������������������������������������� 27 Current Somaliland Banking & Finance Environment �������������������������������������������������� 29 III.Conference Outcomes ��������������������������������������������������������������������������������������������� 30 IV.Media Coverage and Feedback �������������������������������������������������������������������������������� 31 Table of Contents Table Appendices ����������������������������������������������������������������������������������������������������������������� 34 Somaliland banking & Finance Conference www.somalilandbafc.com Background Somaliland is a Sub-Saharan country located in the Horn of Africa, sharing boundaries with the Gulf of Aden in the north, Somalia in the east, the Federal Republic of Ethiopia in the southwest, and the Republic of Djibouti in the northwest. It has a total surface area of about 176,119.2 square kilometres and a coastline, which is 850kilometers long. It lies between Latitudes 80 and 110 27’ North and Longitudes 420 35’ and 490 East and has mountain ranges rising up to 1800 and 2100 meters in the centre and in the east of the country respectively. Somaliland gained independence from Britain on June 26th, 1960. On July 1st, 1960, the state of Somaliland united with Somalia, a territory under a U.N. mandated Italian Trusteeship until that same day, thereby creating the Somali Republic. The Republic of Somaliland restored its independence after the total collapse of Somalia on 18 May 1991 as a result of the civil war of the late eighties and early nineties. Since the declaration of statehood Somaliland has managed to secure peace and stability for over 28 years after over a decade of civil war and state collapse. Whilst post-war reconstruction was difficult, Somaliland achieved notable successes of livestock exports, developing banking system,economic growth and government revenues mobilization, which increased strongly since independence. However, despite the progress that has been made, Somaliland still is one of the poorest countries in the world. Somaliland’s economy is highly dependent on livestock, but needs to be diversified. Although, Somaliland was ranked as 18th most peaceful state and 27th best democratic governance in Africa, it suffered from the lowest GDP per capita of $675 and its unemployment rate of 70% (PSA, 2017). In terms of ease of doing business, the country is ranked 174 out of 184 countries (World Bank, 2012). Accordingly; it has been moving from humanitarian, recovery, and reconstruction stages; and finally, toward relative development status. Overall assessment indicates that the country has made notable developmental progress with most social and economic indicators showing slight improvement. However, the country continues to face a number of social and economic challenges, ranging from high levels of youth unemployment, issues relating to education, health, urbanizations, rural-urban migration, and the large unbanked or financially excluded population. Conference Report 5 Somaliland banking & Finance Conference www.somalilandbafc.com The financial sector of Somaliland started with the establishment of the Bank of Somaliland as the central bank of the Republic of Somaliland, which was founded in 1994; The Bank’s mission is to promote the wellbeing of the people of the republic of Somaliland by maintaining monetary and financial stability. It is 100% owned by the Government of Somaliland but it is constitutional autonomous institution. To promote the safety and soundness of the financial institutions, the Central Bank of Somaliland regulates and supervises both public and private sector 16 money transfer business, three licensed banks, 3 Insurance company, two Mobile money operators, two Micro finance institutions and over 360 foreign exchange dealers/ agents. In short this means working to prevent future financial crises or reduce their frequency and severity. Conference Report 6 Somaliland banking & Finance Conference www.somalilandbafc.com Executive Summary Bank of Somaliland (CBSL) together with the Ministry of Finance (MOF) organized the First Somaliland Banking and Finance Conference from 22-23 June, 2019 in Hargeisa, under the theme of “Promoting Banking and Financial Sector: Connecting People to Banking & Financial Service”. The conference established itself as a unique platform for the exchange of knowledge and experience in the area of Banking, Insurance, Remittance, microfinance institutions, and Fintech companies, which brought together all participants in the financial industry. Over 200 participants attended, these included the government, Chamber of Commerce, Djibouti Consulate, Ethiopian Consulate, Turkey Consulate, Private Banks, Insurance companies, Remittances, Mobile Money Service Providers, Universities, UNDP, an International Organization, Civil Society Organizations, Cooperatives, Experts and SABA Bank In this event it was the for the first time an open discussion on these topics with the participation of financial institutions, state regulatory bodies and public organizations for consumer rights protection and industry experts became possible. on the other side, There were three plenary sessions led by financial sector experts in Somaliland along with presentations and discussions by prominent academics, policy makers, bankers, private sector actors, opinion leaders, researchers and representatives from development organizations. There was a parallel exhibition platform where financial institutions showcased products and services. This exhibition was also used as an outstanding deal making where local financial institutions engaged and evaluated promising investment opportunities. The exhibitors were from the banking, Insurance, remittances and fintech companies, and Micro-Finance from all over the country. Conference Report 7 Somaliland banking & Finance Conference www.somalilandbafc.com The specific objectives of the conference were: • To promote banking, and financial services in Somaliland • To strengthen the collaboration between the Government and the Private Financial Institutions. • To identify the current status of Financial Sector and to address key challenges in Ac- cess to Finance. • To create a platform in which the financial sector issues can be discussed and produce an effective decisions. The outcome was a very positive feedback from both participants in the financial industry and the general public. The conference affirmed the importance of promoting financial services for Somaliland Economy and It concludes with the following ‘Call to Action’: - The swift implementation of Somaliland’s Financial Sector Development Strategy. That is aim to mainstream financial inclusion, products, literacy, and equity. The central bank was lauded for its heroic undertaking of spearheading the facilitation of the legal framework and the regulatory laws needed for the financial institutions. At the conference, there was a unanimous acknowledgement and applaud for the strides the private financial institutions had made, and the continued need for them to play a positive driving force in the elimination of the financial obstacles and constrains that are hindering the potential and progress of Somaliland’s society. In the conference generated the momentum to accelerate and support the development of Somaliland Financial services and putting in place the enabling environment. Conference Report 8
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