Highlights
- • Livestock sector plays important socioeconomic role in Somaliland economy. Livestock import bans heavily affected the sector.
- • COVID-19 is worsening the situation. Saudi government suspended Umrah visits in 2020 and reduced the number of Hajj pilgrims.
- • Losses due to the partial Saudi livestock ban on Somali imports are estimated to US$770 million for the Somaliland region.
- • COVID pandemic losses are US$42 million. Exporters followed mitigation strategies by increasing exports to other countries.
- •Livestock producers are most affected incurring 50% of total losses. The situation is similar in other countries like Sudan.
Abstract
The livestock sector plays an important socioeconomic role in the Somaliland economy, particularly through revenues from exports. The partial ban on livestock imports from Somalia imposed by Saudi Arabia due to animal health concerns has resulted in significant negative economic impacts for the government and the value chain actors involved. In previous years, the ban was lifted during the Hajj season to meet the increased demand for sheep and goats. However, given the current COVID-19 pandemic, the Saudi government decided to suspend Umrah visits in 2020 and only allowed a very restricted number of persons to attend the Hajj pilgrimage, thus obviating the need for livestock imports. This study quantified the economic losses associated the current partial livestock ban (started in November 2016) on Somali imports and the added impacts associated with COVID. We estimate that the cumulative losses for the Somaliland livestock sector and the government are US$ 770 million over a five-year period. The additional losses imposed by the COVID pandemic, which restricted participation during the Hajj season, were estimated at US$ 42 million. Livestock producers, who are mainly pastoralists, are the most affected stakeholder group, incurring around 54% of the total losses. Our study highlights the multifaceted, and often overlooked, socio-economic and socio-cultural impacts faced by the livestock sector and general economy in the wake of public health restrictions.
1. Introduction
Livestock is one of the main economic pillars of the Somali economy. In Somaliland (north-western part of Somalia), live animal exports are vital for its economy, contributing 85% of export earnings and 30% of the Gross Domestic Product (GDP) and directly and indirectly employs 70% of the population (Mugunieri et al., 2016). At the production level, the livestock value chain is mainly supplied by smallholder producers (pastoralists and agro-pastoralists) whose livelihoods are directly linked to livestock rearing and trade. Other actors involved and directly benefiting from the livestock export value chain include traders and agents of exporters, service providers (veterinarians, agro-vet shops, transporters, quarantine stations, port facilities, etc.), government (through tax receipts), and exporters.
Somaliland’s livestock exports are mainly directed to the Saudi Arabian market (especially for sheep and goats) with other Middle East markets growing in importance (Yemen and Oman for cattle and UAE for sheep and goats). In 2016, Somaliland exported about 3 million heads of livestock to the Arabian Peninsula (AP) from Berbera Port, including 2.8 million sheep and goats to Saudi Arabia (SLCCIA, 2016). The Muslim Hajj season represents the peak season, and estimates of its importance on trade range between 52% (Mugunieri et al., 2016) and 70% (Majid, 2010) of total exports. The period between the months of Ramadan and Dhu Al Hijja (Islamic calendar) forms the main part of the peak season.
The current COVID-19 pandemic has considerably impacted this trade during the peak Ramadan period in 2020. The Saudi government decided to suspend the Umrah visits (those to the holy cities of Mecca and Medina outside of the Hajj period) from March 2020 (France24, 2020) and has drastically reduced and limited the number of persons to attend the Hajj pilgrimage. From a number of 2.5 million pilgrims who attended in 2019, the following year (2020) the number was a tiny fraction of around 10,000 persons (Aljazeera, 2020). In addition, the COVID-19 pandemic and the collapse in oil prices have negatively impacted the oil-dependent economies of the AP countries’ economies (Arezki et al., 2020). These dynamics portend considerable losses for the Somaliland government and livestock value chain actors.
Livestock and livestock products are often consumed during religious and non-religious festivals across the world. While this paper focuses on the particular case of small ruminant slaughtering as part of the Hajj pilgrimage, the use, or consumption, of animals, meat, milk or eggs is common during numerous festivals like the Grand Magal of Touba in Senegal, Thanksgiving in the USA, Christmas in Europe and other countries, etc. These festivities represent an important market for producers and any disruption, like the current COVID-19 pandemic or an animal disease outbreak, could have heavy consequences on their incomes and profits, and highlight the often-overlooked quantification of the temporal impacts of animal diseases (Rich and Perry, 2011).
In this study, based on a combination of secondary data and the use of a recently developed system dynamics model of the small ruminant value chains, we assessed the economic costs and social implications for the Somaliland economy in general and small ruminants subsector in particular due to partial livestock export bans (temporarily lifted during the Hajj season) and the current COVID-19 pandemic and its subsequent reduction in the number of Hajj pilgrims.
2. The demand for livestock during seasonal festivals
Festive seasons and religious ceremonies represent an important market for livestock producers and traders. For instance, in the city of Touba – Senegal, the Grand Magal religious gathering receives every year between 4 to 5 million pilgrims mainly from Senegal (Gautret et al., 2020). During these festive days, special dishes are prepared like méchoui (roasted sheep) and Touffé that is a special dish with chicken or beef with an onion garlic sauce with potatoes. During Magal de Touba, people normally eat meats such as chicken, camel, sheep, and beef (CREATE!, 2018). In 2020, despite the COVID-19 pandemic, the Grand Magal was celebrated and millions of devoted persons attended the celebrations, with little to no impact on the progression of COVID-19 in Senegal at that time.
Increased demand for sheep during Tabaski (Eid al-Adha) also demonstrates the effect of religious festivities on livestock trade and is an important phenomenon in the livestock trade between countries in the Sahel region (Mauritania, Burkina Faso, Niger and Mali) and those in the West African coast (Senegal, Ghana, Côte d’Ivoire, Benin and Nigeria). During these festivities, many Muslim families sacrifice a young male sheep to commemorate the willingness of Abraham to obey God’s command to sacrifice his son, before God intervened and provided him with a ram to sacrifice instead. Studies including Apolloni et al. (2019) and Valerio et al. (2020), report that cross border trade in sheep increases significantly in the months leading up to Tabaski. In 2014, when Tabaski occurred at the beginning of October, animal mobility data in Mauritania showed an increase in September–October in small-ruminant trades, involving more than 900,000 heads (Apolloni et al., 2018, 2019) compared to less than 200,000 during the preceding month of August (Apolloni et al., 2018). Another analysis by Williams et al. (2006) found that during Tabaski in Burkina Faso, sheep attracted much higher prices consistent with high demand. In Asia, Budisatria et al. (2002) for example cite the increased demand for small ruminants in Indonesia during Muslim celebrations.
Other cases of the importance of livestock in festivals are described in the literature. Aklilu et al. (2007) cite the effects of religious festivals periodically shifting local demand and prices of poultry in Ethiopia. Soares et al. (2012) found that the number of avian influenza infections in both animals and birds in Southern China rose during the Chinese New Year festivities due to increase trade in live poultry. The same pattern has been observed in Thailand (Wiratsudakul et al., 2014), with higher trade up to 15 days before the festivities (including the Chinese New Year). Roesel et al. (2019) found that pork consumption in Uganda is mainly driven by festivals especially during religious celebrations like Easter and Christmas where demand peaks are observed during the months of April and December.
In the United States, turkey consumption represents an important agro-food industry. Data from the National Turkey Federation report the importance of festive and religious seasons on turkey consumption in the country. Around 46 million turkeys are consumed each Thanksgiving, with another 22 million turkeys on Christmas and 19 million turkeys on Easter (University of Illinois Extension, 2020). A recent study by Hayes et al. (2020) indicated that U.S. turkey industry, despite being vertically integrated with a modest number of producers who own most of the supply chain, has been disrupted during the COVID-19 outbreak primarily from the demand side, as consumption switched from food away from home to food at home. The closure of much of the U.S. food service sector—that is, restaurants, school lunch programs, and cafeterias—had a severe impact on U.S. turkey producers (Hayes et al., 2020). The authors conducted a survey on turkey companies in late April 2020, showing important monetary losses (around US$20 million/month losses for the turkey industry), especially for the retail sector (food at home).
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Source: Science Direct
