Disrupting al-Shabaab’s hold on Mogadishu’s economy.

 

The militant Islamist group al-Shabaab has long remained influential in Mogadishu through its sophisticated extortion system, which demands zakat payments —forced charitable tax— and levies on trade and real estate transactions. The group reportedly generates over US$100 million annually, with an estimated one-third of its revenue derived from Mogadishu alone. The report highlights urgent gaps in Anti-money laundering (AML) and countering the financing of terrorism (CFT) enforcement. While Somalia introduced its first domestic sanctions list in 2024, poor compliance and lack of institutional capacity continue to hinder impact. Recommendations include enhanced AML/CFT training for non-financial sectors, incentives for compliance, biometric ID enrolment, and smarter sanctions enforcement through international collaboration.