Several weeks after the Somali state collapsed in 1991, the Northwestern region declared independence. Somaliland Republic has reasserted the separate existence it had as the colony of British Somaliland before independence and union with the former Italian Somalia in 1960. While in Southern Somalia the restauration of peace is still a long way, the Somaliland people created a state from the combination of traditional elders councils and a modern parliamentary system. In Somaliland, peace between hostil clans is given a real perspective. Observers appreciate the political system as a Somali innovation, the country is considered as greatest example for endogenous post-war peace-building. However, the international community is restrained to any acknowledgement. Far away from a legal recognition, the political future of the "quasi"-state Somaliland is doubtful. The international community is trying to suppress the decentralizing processes at the Horn of Africa and stakes on to the restauration of a centralized state in Somalia.

Why did Somaliland declare independence from Somalia? And why does it hold on to independence? I do not believe in a so called "ethnic" conflict in Somalia: The civil war in Somalia is a social conflict, its roots date back several decades. The secession of Somaliland does not mean a growing ethnicity of the Northwestern Somali people. Behind nation-building processes you can often find hidden interests. Which social groups profited from the declaration of independence? The economic decay of the Somali state during the 1980s led to political repression and to an informalization of Somali economy - some call it "shadow economy". The political turn of Siyaad Barre at the beginning of the 80s - from communist to capitalist ideology - went aside with his attempt to deprive the counter-hegemonic elites from their power in Northern Somalia. Because of the nationalization of the most important markets there, the Northern Somali opposition party, Somali National Movement" (SNM) got great financial assistance from the export traders who were impeded in their economic activities.

This paper argues that the declaration of Somaliland Republic, as a counter-hegemonic project, is a direct result of the formation of elites during the commercialization of pastoralism under British colonial rule. The separation of Mogadishu and the long-term limitation of the Somaliland state-power are both in the very interest of the dominating traders. To secure these economic interests, great activity is seen to keep state-power marginal. Main actors in Somaliland are holding on to independence, knowing that international community nowadays favours the model of the European nation-state. Donors are only attracted by state-like structures - even though it is nothing but a facade.

Decay of state institutions and structural adjustment programs lead to the formation of parallel markets. This "informal" sector helps the little man to survive but also it is used by elites to enhance their prestige and monetary wealth. Many argue that in Africa nowadays only the informal sector grants endogenous economic development. It is expected that from this economy comes the power to rebuild the state. However, believing that civil society is splitted of the state is a European myth: In Somaliland it is obvious that economic mainactors are those disappointed state elites that saw no opportunity to profit from the state system. They concentrated on the parallel economy to reap the benefits from these structures in a fully deregulated economy of a new state Somaliland.

For nowadays, the economy of Somaliland is completely deregulated despite of state institutions that were rebuilt after independence. Informal economic activities are not seen as illegal but are "legitimate informal" - to say it with Patrick Chabal. The former president of Somaliland who died at the beginning of this month, Maxamed Xaaji Ibrahim Igaal, introduced a national currency and a national bank. However, mainactors do not trust Somaliland financial policy: National and international companies prefer to change money on the parallel market. The government`s attempts to support the national financial system failed. An example: In 1995, the government tried to support Somaliland-Shilling by sanctioning foreign exchange operations and by fixing the exchange rate, which caused strong public protest. Many traders threatened the government with moving there activities to Puntland in Eastern Somalia, where there are no restrictions for export trade. Even though the parliament dropped this unpopular decree in 1996, the economy is still very suspicious to state policy. Economic mainactors blame the government for extreme inflation in 1996 as well. For the state tried to compensate enormous budgetary deficite by printing money. The budget of Somaliland state totals round about 30 million US$. This amounts only to 60 percent of actual expenditures. One reason is that the administration of Somaliland sees itself confronted with great difficulties in taxing its nomadic population, like all of its Somali predecessors.

Shortly after the Somali state collapsed in 1991, Berbera port in Somaliland was reopened. There it turned out that foreign trade relations could be reactivated quickly, which confirms Somaliland economy`s orientation on trade. Export of livestock is still the biggest part of export volume. But cultivation and trade of khat is the upcoming business: Since the late 60s, livestock trade via Berbera port increased constantly. Close to arab markets, livestock prices were high. In 1978, about 80 percent of livestock exports left the country through Berbera port. After the port reopened in 1991, this trend continued. Today, Somaliland export traders are successful in controlling the majority of all Somalia`s livestock exports. Northern Somali descendants of the first national elite are gaining from the state Somaliland, because independence pushed them from periphery to core of power. So the export traders have their own state now. No more rivals, no more fear of Mogadishu`s hegemony. It is easy to put the government under pressure: The traders` menace of turning their activities out of Somaliland which means to minimize the state`s tax earnings, is sufficient to keep state power marginal.

Khat is a mild narcotic, mainly cultivated in the highlands of Ethiopia. Its active substance evaporates within days. The increasing consumption at the Horn of Africa and in Yemen makes the cultivation and trade a boom industry - explicitly in Somaliland, which will be shown. Khat chewing is a relatively new phenomenon in Somaliland. It started along with urbanisation and rise of an indigenous elite under British colonial rule. Improvement of transportation led to an increase of consumption of the down-settled young urbans. ,Nowadays, it seems that everybody is chewing khat all day, everyday." (Nair 1999) Few wholesalers make a large profit from khat, but increasing consumption means a serious danger for society and national economy. Chewing khat is an expensive activity: It is estimated that the costs of chewing amount to 1500 US$ per year - same as the per capita income. Some argue that chewing khat slows down the productivity and that it leads to an erosion of working morale. I do not believe this is true, for it is obvious that consumption raises with unemployment figures.

Whether you damn the chewing of khat or call it the ,food of the holy man": there is no doubt that the narcotic`s trade is one of the most productive economic sectors in Somaliland. This is proved by an UNDP research in 1997. Khat is not criminalized in Somaliland, the administration imposes even a tax on its import. But taxes on khat are lower then any taxes levied on luxuary goods in similar states. UNDP recommends therefore a higher taxation which may be difficult in reality. The wholesalers are members of the clan Habr Awal which is quiet successful in controlling the government. This lobby is setting limits to the power of the state. Now, what is exactly the role of Somaliland state' Let us think of the European ideal: There, the state guarantees its citizen`s legal protection. The monopoly on the use of force means protection against personalized power. Its sovereignty means security for economic actors. The internationally recognized nation-state is a fund-raiser who provides access to the markets. The division of the ruler`s person and the institution of his rule means that all citizens are equal in law and equally good.

Such concept of the state is pure fiction in Somaliland. The state is not institutionalized at all, nor does it claim the monopoly on the use of force and full control of its territory. The power of the president is fully legitimated inside the country. But he does not enjoy any reputation beyond the borders of Somaliland. But not only missing international acknowledgment weakens the state. Its power is to be marginal, its legitimacy comes from a combination of clientelism and lineage dominated organisation, basing on networks. This clientelistic system favours a weak state who has no administrative control of its territory. Somaliland state is completely privatised: The political class favours its clients in taxing, assigning goods, placing of public orders. And the clients make available money for demobilization. But the most important role of the state in Somaliland is to maintain an unequal access to the market. Economic tensions have an clan dimension here: The clan next to Igaal, Habr Awal, keeps control over Berbera port and khat trade. And the clans of Garxajis and Habr Jeclo control the most important parts of livestock trade. Trade in Somaliland is such a profitable business, because the administration is used to maintain the balance of the clans` economic power.

Trutz von Trotha once said that in Africa, places of power are always places of petitioners (Trotha 1991). But in Somaliland you can notice the opposite: High government officials only draw symbolic salaries. The real income are donations of members of their own clan. The donors know very well that the addressees are obliged to reply to the donation. In return for it, the officials speak up in parliament for their friends` tax exemption or turn a blind eye on wildlife trophy traffic. So in Somaliland, few economic tycoons are interested in building a state system whose power is easy to control. This behaviour does not encourage the state`s consolidation but weakens it on a long-term basis. For the donation cements given inequalities between the different clans.

In fact, a national identity or even a polity cannot be constructed because the conditions of reproduction do not belong to the state`s abilities. In Somaliland, it is a small and influential part of the society who captures the state and not the opposite. One last example which makes quite clear the interdependence of economy and politics in Somaliland: A big success for the wholesalers of former president Igaal`s clan Habr Awal is a change of the main trade route for khat. Every day, ten tons of Khat leave Ethiopia for the Arab peninsula. When Somaliland was still a part of Somalia, the narcotic with destination Yemen was always shipped in Djibouti. Nowadays, Berbera port is taking the neighbor`s place. For in the quasi-state Somaliland, taxes and duties are lower, and legislation here is more vague then in Djibouti.

The question now is whether a state like Somaliland can claim its independence on a long-term basis. Will Somaliland ever be a full member of the international community' The construction of national institutions and the nearly successful demobilization, the creation of democratic structures like parliament and national elders council make Somaliland look like a stable and secure partner. The government wants to show that the country is ready for international donors. The lack of international interest is hard for Somaliland. There are many reasons for this worldwide indifference. I want to mention two of them:

Somalia is still a full member of the United Nations, even though its membership is suspended for the moment. As long as there is no government in Mogadishu that accepts Somaliland as independent, there won`t be any international recognition. Today, there is only little hope that the actual provisionary government of Mogadishu will move in this direction. Abdoulkassim Salat Hassan, interims president of Somalia, is fully accepted by international community. He won`t let Somaliland go its own way, because Mogadishu needs its tax revenues. In fact, the independent status of Somaliland and the hope for a long-term solution of the Somali conflict which could be a somehow federal state system, is sacrificed in favour of an ad hoc installed provisionary government which certifies for the world that African borders are sacrosanct.

Besides, the international community still favours the European model of the nation-state. There is a great fear in Europe and the United States of so called "failed states". The world faces them with suspicion and helplessness, it rejects endogenous political developments as processes of "retraditionalization" who do not fit with modernity. Time will tell, if the world will one day accept human political systems and societies that differ from the European model.