Kenya is experiencing significant revenue losses at its Mandera border with Somalia and Ethiopia due to the continued closure of the Somalia border and the unregulated movement of goods along its border with Ethiopia. Despite ongoing efforts to reopen the Somalia border, which has been closed for over 16 years, trade continues informally through illegal routes, with goods flowing in and out without government oversight. This situation is costing Kenya billions of shillings in uncollected revenue, a pressing issue in a country that is actively seeking new streams of income to address budgetary deficits.
The Kenya-Somalia border at Border Point 1 is officially equipped with all the necessary infrastructure for regulated cross-border trade, including customs offices, immigration facilities, and a border patrol post. However, since the administration of former President Mwai Kibaki, this border point has remained closed due to security concerns related to the activities of the militant group Al Shabaab. The group, which operates across the border in Somalia, has historically used the porous Mandera border to enter Kenya, carry out terrorist attacks, and plant improvised explosive devices (IEDs). As a result, the border was closed as part of Kenya’s broader security efforts, particularly after the Kenya Defence Forces (KDF) launched military incursions into Somalia in 2011 to combat Al Shabaab.
While the closure of the border with Somalia was intended to enhance security, local leaders and officials in Mandera are now raising concerns about the economic impact. They argue that the continued closure has led to a thriving illegal trade, which the government has no control over, resulting in substantial revenue losses. The trade includes essential goods like sugar, rice, powdered milk, and pasta, which are brought into Kenya from Somalia’s Bula Hawa town via informal, unmonitored routes. Simultaneously, goods from Kenya, including maize flour, tea leaves, and plastics, are being sold across the border in Ethiopia and Somalia.
Adan Hamud, the Mandera County Trade Executive, is one of the local officials advocating for the reopening of the border with Somalia. He believes that formalizing cross-border trade by reopening the border would benefit both the national government and Mandera County by increasing revenue through regulated commerce. According to Hamud, while reopening the border might lead to a short-term increase in the cost of basic goods due to the introduction of tariffs and taxes, it would be advantageous in the long term.
“It would be disadvantageous for Mandera residents in the short term because the cost of basic supplies would go up, but helpful for us and the country in the long run,” Hamud stated. “The opening of the border would invite the Kenya Revenue Authority (KRA), meaning that the cost of basic supplies would go up, but with legitimized trade, even the county’s revenue generation would go up.”
The lack of oversight at the Kenya-Ethiopia border, on the other hand, has allowed for an even more vibrant illegal trade across the River Daua. The absence of an official entry point or customs office has created a free-for-all where goods move freely between the two countries without regulation. River Daua serves as a natural border between Kenya’s Mandera County and Ethiopia, and traders have used rafts to ferry goods across, bypassing any government intervention. As a result, the volume of goods exchanged between the two countries is substantial, but none of the trade is taxed or monitored by the Kenyan government, leading to further revenue losses.
While the closure of the Somalia border and the unregulated trade with Ethiopia may have sustained local livelihoods in Mandera, the national government is losing out on potential revenue. This is particularly concerning as Kenya faces financial shortfalls and is looking for ways to boost its income. Security officials in Mandera acknowledge the existence of illegal cross-border trade but emphasize that it is a necessity for the local population. According to Mandera’s Deputy County Commissioner, Patrick Meso, the illicit trade, though illegal, ensures that residents of the county have access to basic food supplies, particularly during times of drought or when transportation infrastructure is disrupted.
“It is only on basic foodstuff, especially during droughts,” Meso explained. “As a government, we cannot let our people die of hunger because the border is closed. We allow minimal movements to bring basic supplies.”
Meso pointed out that in some cases, heavy rains cut off roads and flood the airstrip, making it impossible to get supplies from Nairobi or other parts of Kenya. In such situations, the local population relies on goods from neighboring Somalia and Ethiopia to survive. While the government permits some informal movement of goods during these times, the broader issue of lost revenue remains.
Recently, there have been signs that the government is considering reopening the Kenya-Somalia border. In July 2024, Interior Cabinet Secretary Kithure Kindiki announced that there were ongoing plans to reopen border points between the two countries, including in Mandera, Liboi, and Kiunga. However, these plans have been delayed due to security concerns related to Al Shabaab’s continued presence in the region. Kindiki emphasized that the government is prioritizing peace and security before proceeding with the reopening of the border points.
“Kenya and Somalia have been planning to reopen our border points in Mandera, here in Liboi, Kiunga, and other areas along the border,” Kindiki said. “The plan will go on, but at the moment, we are delaying it due to disruption of peace and security. We have stopped that plan for a period to allow us to deal with the militants.”
Meanwhile, a multi-agency team led by Macharia Chege, the KRA Deputy Commissioner in charge of customs, border management, and enforcement, visited Mandera to assess the situation. The team met with local leaders and toured both the Somali and Ethiopian borders to explore the feasibility of setting up customs offices and officially regulating trade at these entry points. The team’s visit has raised hopes among local leaders that the border with Somalia may soon reopen, allowing the government to formalize trade and capture lost revenue.
Mandera Deputy County Commissioner Meso expressed optimism that the process for reopening the border could begin soon, particularly given the multi-agency team’s visit to assess the situation. He noted that Mandera is a crucial county for Kenya’s trade and security, and the fact that national teams are visiting the area suggests there is goodwill from the highest levels of government.
“Mandera is a very important county. When we start seeing teams coming to assess it, that means there is goodwill from the high office,” Meso added.
Reopening the border with Somalia presents a complex challenge for the Kenyan government. On one hand, it would provide much-needed revenue for both the national government and Mandera County, while also formalizing and legitimizing cross-border trade. On the other hand, the security concerns related to Al Shabaab’s presence in the region cannot be ignored. The government must balance the economic benefits of reopening the border with the need to ensure peace and stability in the region.
Until the security situation improves, it is likely that illegal trade will continue across the Mandera borders with both Somalia and Ethiopia. However, the recent visit by the multi-agency team and the government’s ongoing discussions about reopening the border suggest that change may be on the horizon. If the border is reopened and trade is formalized, Kenya stands to gain significantly by recapturing lost revenue and improving trade relations with its neighbors.
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