Somalia was without a formal parliament for more than two decades and it was not until 2012, when a new government was installed, that the country began the process of stabilization. Following conflict and instability the country’s infrastructure is in poor state.
Somalia's dynamic and entrepreneurial private sector helps fill the void of government institutions, and various private sector organizations have signed agreements with the government for significant provision of services. However, businesses operate in a legal and regulatory vacuum with little or no formal government enforcement as the Federal Government of Somalia (FGS) has neither the institutional capacity nor the policy, legislative and regulatory framework for managing public procurement and concessions.
Currently, there is no policy and regulatory framework but the FGS has considered developing a PPP program. The Public Procurement and Concessions Law (2014) has been enacted by the Parliament and is yet to be accented by the President.
Despite these efforts and given the volatility and security situation in FGS, a lack of expertise in the form of qualified public sector PPP specialists as well as a lack of investors and private operators persist. As of 2015, Somalia has implemented three PPPs in the telecom and transport sectors.
The Global Competitiveness Index (GCI) is published in the Global Competitiveness Report and assesses the competitiveness landscape of 140 economies. The GCI Infrastructure Score is a component of the overall index and covers transport, electricity and telephony infrastructure.
The article "Risky businesses: by Gonzalo Araya and Jordan Schwartz discusses private participation in infrastructure (PPI) in the high risk countries. Countries emerging from conflict show that affected nations typically require six or seven years to attract significant levels or forms of investments in infrastructure from the day that the conflict is officially resolved. The first infrastructure investments to arrive in conflict-affected countries are in sectors where commercial risk is relatively low, primarily in mobile telephony. Private investments in sectors where assets are harder to secure—such as water, power distribution, or roads—are slower to appear or simply never materialize.