Publisher: Warsame Digital Media (WDM) September 2025 © 2025 WDM – All Rights Reserved

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This white paper is published by Warsame Digital Media (WDM). The findings, interpretations, and conclusions expressed herein are those of the authors and do not necessarily reflect the views of any affiliated institutions. Unauthorized reproduction or distribution is prohibited. For queries, please contact: ismailwarsame@gmail.com; Tel/WhatsApp: +252 90 703 4081.

Table of Contents

1. Executive Summary
2. Introduction: A Dispute of Principle, Not Just Revenue
3. Constitutional Jurisdiction and the Ambiguities of Federalism
4. The FGS Revenue-Sharing Proposal: A Rejected Offer
5. Puntland’s Position: Sovereignty and the Precedent of Overreach
6. Analysis: Governance Deficits and the Failure of Cooperative Federalism
7. Implications: Economic Costs and Political Risks
8. Policy Recommendations: A Pathway to Resolution
9. Conclusion: A Critical Juncture for Somali Federalism

1. Executive Summary

The launch of the Somali E-VISA system by the Federal Government of Somalia (FGS) has ignited a significant constitutional and political dispute with Puntland State. This paper argues that the core of the conflict extends beyond superficial accusations of corruption to a fundamental breakdown in Somalia’s federal model. It is a crisis of constitutional interpretation, fiscal federalism, and intergovernmental cooperation.

While the FGS holds clear constitutional authority over immigration, its proposal of an 18/42 revenue split—offering Puntland the majority share ($42 of every $60 fee)—was rejected. Puntland’s refusal stems from concerns over federal overreach and the erosion of its fiscal autonomy, not the specific financial terms. With monthly revenues from Puntland airports exceeding $200,000, this impasse has become a major flashpoint.

This paper analyzes the legal underpinnings of the dispute, the governance failures it exposes, and its grave economic and political consequences. It concludes with concrete policy recommendations to resolve the immediate crisis and establish durable mechanisms for cooperative federalism in Somalia. Failure to do so risks deepening fragmentation, undermining public trust, and stifling economic recovery.

2. Introduction: A Dispute of Principle, Not Just Revenue

In Somalia’s nascent federal architecture, disputes over resource allocation and jurisdictional boundaries are inevitable. The E-VISA conflict, however, represents a critical test of the system’s viability. Public discourse has often simplified the issue, but this paper contends that the standoff between Mogadishu and Garowe is primarily a conflict of principle. It is a manifestation of unresolved tensions inherent in Somalia’s Provisional Constitution, pitting federal authority against state rights and highlighting the absence of a trusted framework for sharing power—and revenue.

3. Constitutional Jurisdiction and the Ambiguities of Federalism

The Provisional Constitution (2012) explicitly grants the Federal Government exclusive jurisdiction over four key areas:

1. Foreign Affairs
2. National Defense
3. Citizenship and Immigration
4. Monetary Policy

Visa issuance is unequivocally a function of foreign affairs and immigration, placing the E-VISA system within the FGS’s constitutional mandate. However, the constitution is silent on the practical implementation of these exclusive powers, particularly when their exercise generates revenue within a federal state’s territory and relies on its infrastructure (e.g., airports) and administrative support (e.g., border control).

Puntland’s argument is not a direct denial of federal authority but a demand for a cooperative implementation model that recognizes its operational role and fiscal rights.

4. The FGS Revenue-Sharing Proposal: A Rejected Offer

In an attempt to address these concerns, the FGS presented a revenue-sharing proposal. According to Puntland finance sources, the terms were:

· Fee: $60 per E-VISA
· Proposed Split: $42 to Puntland, $18 retained by FGS
· Estimated Revenue: >$200,000/month from Puntland airports

This arrangement would have transferred an estimated $2.4 million annually to Puntland’s treasury, representing a significant potential investment in local infrastructure and services. The rejection of this ostensibly favorable financial deal underscores that the dispute is fundamentally about governance and sovereignty, not mere revenue.

5. Puntland’s Position: Sovereignty and the Precedent of Overreach

Puntland’s refusal of the 18/42 split is rooted in three core concerns:

1. Unilateral Federal Action: Puntland contends that the FGS overstepped by implementing a revenue-collection system at Puntland airports without prior agreement on a jointly administered mechanism.
2. Dangerous Precedent: Accepting a share of federally collected revenue, even a majority one, is viewed as legitimizing federal encroachment into state jurisdiction and setting a precedent that could be applied to other areas like natural resources or port revenues.
3. Political Leverage: There is a deep-seated fear that control over the revenue stream provides the FGS with a political tool to pressure or punish federal states, thereby eroding their hard-won autonomy.

6. Analysis: Governance Deficits and the Failure of Cooperative Federalism

This dispute reveals systemic weaknesses in Somalia’s governance structure:

· Absence of a Fiscal Federalism Framework: There is no legal framework to define revenue sources, sharing formulas, and responsibilities for jointly administered functions.
· Institutional Vacuum: No standing, empowered intergovernmental body exists to mediate such disputes, forcing ad-hoc negotiations that are vulnerable to political volatility.
· Profound Trust Deficit: A history of centralized rule and unmet agreements fuels a zero-sum mentality, where cooperation is perceived as concession.

7. Implications: Economic Costs and Political Risks

7.1 Economic Impact

· Lost Revenue: Puntland forgoes a stable revenue stream critical for local service delivery.
· Double Taxation: Travelers are now subject to both the federal E-VISA fee and a separate Puntland visa fee, increasing costs and creating bureaucratic redundancy.
· Investment Deterrence: The uncertainty and added expense undermine confidence among the diaspora and international investors, hindering economic recovery.

7.2 Political Fallout

· Escalating Tensions: The dispute exacerbates existing conflicts over security, elections, and resource management.
· Erosion of Legitimacy: The public perceives both governments as engaged in counterproductive turf wars, undermining their legitimacy.
· Fragmentation Risk: Prolonged impasse could lead Puntland to establish parallel systems, fracturing national policy and weakening integration.

8. Policy Recommendations: A Pathway to Resolution

To resolve this dispute and fortify Somali federalism, we recommend:

1. Immediate Establishment of a Joint Technical Committee: Composed of technical experts from the FGS Ministry of Finance and Puntland’s Treasury, this committee should work to implement a temporary revenue-sharing agreement with full transparency.
2. Enact a National Fiscal Federalism Law: A priority for the federal parliament should be to legislate a clear framework for revenue-sharing from all federal competencies exercised within state territories, including visas, ports, and natural resources.
3. Formalize a Federal-State Council: Create a constitutionally-mandated intergovernmental council with the authority to negotiate and bindingly resolve disputes, moving beyond ad-hoc political dialogues.
4. Implement Transparent Reporting: Both governments should commit to publishing audited monthly reports on E-VISA revenue collection and distribution to build public trust and eliminate speculation.
5. Leverage International Technical Assistance: Engage neutral international partners (e.g., World Bank, IMF) to provide technical models for revenue-sharing and facilitate mediation, ensuring the solution is perceived as fair and evidence-based.

9. Conclusion: A Critical Juncture for Somali Federalism

The E-VISA dispute is a microcosm of the broader challenges facing Somalia’s federal project. It is a stress test that neither level of government can afford to fail. Resolving it requires moving beyond a winner-takes-all approach to embrace a philosophy of cooperative federalism. The choice is between forging a collaborative path that strengthens the union or descending into further fragmentation. The establishment of transparent, predictable, and legally sound mechanisms for sharing power and revenue is not just a solution to this crisis—it is the essential foundation for a stable and prosperous Somalia.

By Ismail H. Warsame

Puntland’s leaders have perfected the art of political sloganeering. For years, they’ve reminded Mogadishu that the Federal Government has only four constitutionally mandated jurisdictions: foreign policy, national defense, national treasury (currency and finance), and citizenship/passport control. Everything else, they say, belongs to the States. It sounds principled — a rallying cry for federalism and constitutionalism.

But slogans are not strategy.

The latest E-Visa debacle proves that Puntland’s political class has mistaken stubborn posturing for visionary statecraft. By refusing to recognize the Federal Government’s electronic visa system — reportedly rejecting a fee-sharing proposal — Puntland has managed to create a situation where ordinary residents are now paying double: once to Mogadishu, once to Garowe.

When Federalism Becomes a Tollbooth

Let’s be clear: a national passport and its supporting visa system fall squarely under foreign affairs — one of the very four areas Puntland itself concedes to Mogadishu’s jurisdiction. By resisting the federal E-Visa, Puntland is not “defending federalism”; it is building a second tollbooth at the airport gate, extracting revenue from its own citizens and diaspora visitors.

The losers in this political tug-of-war are not Mogadishu bureaucrats — they are ordinary Puntlanders, businesspeople, students, and diaspora families forced to pay extra for what should be a streamlined, single process.

Visionless Politics, Costly Consequences

What we are witnessing is not simply a bureaucratic mishap — it is the cumulative effect of bad decision-making and lack of vision by Puntland’s current administration. Instead of negotiating a fair revenue-sharing formula or developing a long-term federal-state harmonization strategy, Garowe has opted for confrontation and quick cash grabs.

And the damage does not stop there. Some Puntland ministers (Finance, as example) have alienated not only the Federal Government but also international partners whose cooperation is critical for Puntland’s development:

Broken Trust with Donors: Key international donors have quietly reduced their direct funding to Puntland after repeated policy U-turns and accusations of financial opacity.

Suspicion from Global Financial Institutions: The World Bank and IMF have voiced concern over Puntland’s lack of cooperation and its reluctance to integrate with national fiscal reforms — jeopardizing Puntland’s access to future development programs. President Said Abdullahi Deni was either kept in the dark or an accomplice in his ministers’ administrative misconduct to harm Puntland State policy and economy. Some of those ministers still remain close advisers of the President.

Diplomatic Missteps: Garowe’s confrontational approach has frustrated UN agencies and international NGOs, resulting in delays in infrastructure projects and humanitarian aid delivery.

Investor Flight: Several foreign investors have paused or cancelled projects in Bosaso and Garowe due to mixed signals from Puntland’s ministries, who at times contradict each other on taxation and legal guarantees.

This is the same short-termism that has cost Puntland its influence in SSC-Khaatumo, its credibility in democratization efforts, and its leverage over the federal government. At this rate, Puntland risks becoming a provincial fiefdom that survives by taxing everything that moves — while forfeiting its role as the intellectual and political engine of Somali federalism.

The Bigger Picture: Puntland’s Shrinking Strategic Depth

An administration that cannot think beyond next quarter’s tax revenue cannot lead a federalism project that was once the pride of Somalia. The E-Visa fiasco is a warning sign: Puntland’s political elite are content to fight Mogadishu over scraps while failing to articulate a coherent long-term vision of governance, economic development, and constitutional order.

Unless Puntland reverses course, harmonizes its systems with the Federal Government where constitutionally mandated, and rebuilds trust with international partners, it risks alienating its own population, isolating itself diplomatically, and losing its claim as the pioneer of Somali federalism.

WDM Verdict

This is more than an airport nuisance — it is a political failure with a price tag. Puntland’s residents deserve better than double taxation wrapped in the flag of federalism. True federalism requires cooperation, not endless confrontation; vision, not reaction; institution-building, not rent-seeking.

Puntland’s founding fathers imagined a state that would lead Somalia into constitutional order — not one that would charge its own citizens twice just to come home, while simultaneously alienating the very donors and partners who could have financed a brighter future.