Authors : Dr. Amina Omar Mohamud

Volume/Issue : Volume 10 - 2025, Issue 11 - November

Google Scholar : https://tinyurl.com/ynk88muw

Scribd : https://tinyurl.com/42apv59p

DOI : https://doi.org/10.38124/ijisrt/25nov1116

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Abstract : Diaspora-led foreign direct investment (FDI) is a key driver of the private sector’s resurgence in Somalia in the aftermath of a prolonged conflict marked by weak state structures and minimal state capacity. This study provides an overview of the size, sectoral orientation, and developmental implications of diaspora-led FDI in Somalia based on extensive qualitative documentation of academic research, institutional and policy documents, and primary survey data. Our review indicates that diaspora capital facilitates entrepreneurship, technology transfer, and employment generation in Somalia, albeit within a highly uncertain regulatory framework, limited physical infrastructure, and insufficient access to formal financial markets. The study concludes by providing concrete recommendations for policymakers to create an effective and equitable business environment for diaspora investors.

Keywords : Somalia, Diaspora Investment, Foreign Direct Investment, Private Sector Development, Financial Inclusion, Post-Conflict Recovery, Institutional Reform.

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