The Scoop
A US Congressman has filed a bill requiring the Treasury Department to identify the regulatory barriers blocking breakaway region Somaliland’s access to the US financial system — and recommend what Washington can do to remove them.
The Somaliland Economic Access and Opportunity Act, filed on Thursday, targets a specific and largely overlooked problem: Somaliland, which self-declared autonomy from Somalia in 1991, remains unrecognized by virtually every country, leaving it effectively frozen out of the global financial system. Banks can’t easily do business there and remittances from the diaspora — estimated in the hundreds of millions of dollars annually against a roughly $4 billion economy — flow through informal, higher-risk channels rather than the regulated pipelines that would give the territory economic stability and transparency.
Tennessee Republican John Rose, a member of the House Financial Services Committee, said the bill would direct the US Treasury to submit a comprehensive report within 180 days of enactment. It would cover Somaliland’s compliance with international financial standards, remittance flows, access to institutions like the IMF and World Bank, and whether Somaliland can be integrated into financial systems.
Though just a study, rather than a policy change, fixing the financial plumbing for Somaliland is inseparable from the strategic case for Somaliland independence for Republicans like Rose. They see it as a counterweight to China’s growing military and commercial footprint in the Horn of Africa.
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Somaliland’s moment in Washington has been building for years, but the pace has accelerated sharply. Support for Somaliland has grown among Republican US-Africa policy leaders on Capitol Hill, right-leaning DC think tanks, and likely Africa advisors to the Trump White House after the 2024 election. In December, Israel became the first country to formally recognize Somaliland — motivated by the territory’s strategic position along the Red Sea as a potential counterweight to Iran and the Houthis, and framed by Netanyahu as being in the spirit of the Abraham Accords. The move triggered condemnation from the African Union, the European Union, and countries including China, Egypt, and Saudi Arabia.
Somaliland’s President Abdirahman Mohamed Abdilahi has capitalized on Israel’s recognition to lobby Washington directly, pitching the territory’s coastline along the Red Sea, mineral resources, and oil and gas potential to the Trump administration. Somaliland’s supporters in Washington view the territory as a potential security ally, with recognition potentially allowing US intelligence to monitor weapons flows, Houthi activity in Yemen, and China’s growing footprint, including Beijing’s military base in neighboring Djibouti.
Somalia, for its part, is not passive: Mogadishu has made competing overtures to Washington, including offers of port access, in a bid to head off any closer US embrace of Somaliland. The UAE, meanwhile, is already the territory’s largest investor, with port operator DP World having committed more than $400 million to expand the Berbera facility.