Somaliland has stood for more than three decades as a beacon of stability in the Horn of Africa. While the world debates our recognition, we continue to build institutions that prove our readiness for statehood. Our financial system, rooted in Sharia principles, has already established credibility through the Central Banking Act of 2012 and the Islamic Banking Act (No. 55/2012). These laws created the Central Bank of Somaliland, stabilized our currency, and ensured that our banking practices remain ethical and interest-free. But Somaliland’s vision does not stop there.
The International Banking Act is our next step, a sovereign declaration that we are prepared to modernize, integrate, and connect with the global financial system. This Act is designed to invite foreign banks to establish partnerships, facilitate international remittances and trade finance, and align our financial practices with global standards on anti-money laundering and counter-terrorist financing. It will strengthen oversight, guarantee transparency, and diversify services to empower our businesses and citizens.
Our determination is reinforced by growing partnerships. Israel’s recognition of Somaliland as a sovereign state has provided legitimacy and technical expertise in fintech, compliance, and trade finance. This recognition has opened pathways for correspondent banking relationships, helping us move beyond reliance on informal hawala networks. The United Arab Emirates, through its investments in Berbera Port, has become a natural partner in trade finance and banking integration. Ethiopia and any other countries that are not having a problem Somaliland’s trends remain vital for regional trade cooperation, and Somaliland seeks to formalize frameworks that benefit all. These engagements show that Somaliland is not isolated but actively building bridges to the world.
At the same time, Somaliland faces resistance from regional countries who oppose its sovereignty. Turkey, closely aligned with Somalia’s federal government, has invested heavily in Mogadishu’s institutions and lobbies against Somaliland’s independence. Somalia itself views recognition as a direct challenge to its territorial integrity, while Djibouti fears competition from Berbera’s rise as a regional hub. Egypt and Saudi Arabia, influenced by Arab League solidarity and sensitivities around Israel’s role, also resist recognition. This opposition is against Somaliland’s path, but it does not weaken its resolve.
Progress is already visible. Mobile money platforms dominate daily transactions, reflecting the adaptability of our people. Diaspora remittances remain the backbone of our economy, and formal banking will make these contributions safer and more impactful. With support from the World Bank, our Central Bank is drafting regulations on remittances and anti-money laundering to meet international standards. Local Islamic banks already facilitate trade finance, proving our readiness for expansion.
The International Banking Act is more than financial reform. It is a statement of sovereignty and willpower. Somaliland is committed to ratifying complementary legislation, expanding regulatory capacity, and promoting transparency to attract foreign banks and investors. Recognition is not a gift we wait for, it is a reality we are building through stability, responsibility, and vision.
Somaliland’s message to the world is clear: we are ready. The International Banking Act embodies our future, a future of dignity, prosperity, and global connection
Mustafe Jambir is a Somalilander researcher specializing in geopolitics, foreign relations, governance, and development policy, with a focus on the Horn of Africa.
https://blogs.timesofisrael.com/somalilands-banking-act-a-nations-signature-on-the-global-stage/