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CHAPTER-III

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RESEARCH METHODOLOGY OF THE STUDY:

The study is both descriptive and analytical in nature. It is a blend of primary data and
secondary data.The primary data has been collected personally by approaching the online
share traders who are engaged in share market. The data are collected with a carefully
prepared questionnaire. The secondary data has been collected from the books, journals and
websites which deal with online share trading.

Source of data

Primary Sources: The primary data was collected through structured unbiased questionnaire
and personal interviews of investors. For this purpose questionnaire included were both open
ended & close ended & multiple-choice questions.

Secondary method: The secondary data collection method includes:

 Websites
 Journals
 Text books
Method Used For Analysis of Study

The methodology used for this purpose is Survey and Questionnaire Method. It is a time
consuming and expensive method and requires more administrative planning and supervision.
It is also subjective to interviewer bias or distortion.

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CHAPTER-IV
DATA ANALYSIS

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Somalia has been without effective government for 15 years. It has survived, but it has not
prospered. Despite the resilience of local communities and businesses, the absence or
weakness of the state is at the root of underdevelopment, as highlighted in successive
Somali human development reports. The overall objective of the governance, security, and
rule of law cluster is to support the Somali people to develop governance institutions that,
through their credibility, legitimacy, and reconciliation of constituencies, can: a) ensure
security and establish the rule of law; b) regulate commerce and enable private sector
growth with international investment and trade; c) enable investment in infrastructure to
support growth and recovery from war; d) enable the recovery of livelihoods; and e) deliver
social services to all Somalis, through local governance, with community-led initiatives and
partnerships, and thus facilitate the necessary investment in social capital, especially health
and education, to achieve the millennium development goals. Peace building and the
creation of good governance are two key themes that have emerged from the Somali Joint
Needs Assessment (JNA). The challenge for the Transitional Federal Government (TFG) is
to achieve substantial progress in building peace over the next three years, and to build a
solid foundation for good governance by 2011. Twelve strategic objectives make up the
vision for governance, security, and the rule of law over the period 2007-11. These
objectives are presented below under the four sub-clusters used in the JNA process and in
this report: reconciliation and the rule of law; security; government, public administration,
and accountability; and civil society, participation, and media.

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Somalia has not had a strong central government since the collapse of the military regime in
1991. This has led to two decades of lawlessness, destruction and displacement causing the
decay of all public institutions, continued violence, failed peace talks, “warlordism”, chronic
famine and food insecurity, and, in the recent past, piracy and religious extremism. Many
internationally supported strategies have attempted to support a stronger central government and
rebuild trust, law and order. These efforts have included 15 separate negotiation processes.
However, they have not succeeded in establishing a viable, legitimate government.
In several parts of the country such as Somaliland and Puntland, however, new entities of
governance have emerged which enjoy legitimacy from the citizenry. They have largely
moved beyond the widespread violence and chronic instability that have plagued the southern
parts of Somalia. In these relatively stable and autonomous areas, a wide range of indigenous
institutions such as council of elders (Gurti), peace seekers (Nabad doon), women associations
and other local CSOs have replaced the formal administrative structures. They play a variety of
roles in defining community priorities, maintaining peace and making resource allocation
decisions. They largely use a traditional Somalia system of governance which consists of sets of
contractual agreements (xeer) and customary laws, that define the rights and the
responsibilities of the individual within the family, clan and among neighbors. Currently, nearly
all tensions are resolved though Nabad doons and through councils of clan elders (shirar
odiyaal).
Mercy Corps does not run stand-alone governance programs in Somalia but since 2005, when
we first set foot in Somalia, the organization has mainstreamed governance into development
programs to revitalize grass roots home-grow institutions and find solutions that work
specifically in Somaliland, Puntland and other regions. Mercy Corps has focused on enhancing
the capacities of these indigenous structures and initiatives to contribute to peacebuilding,
emergency response and provision of basic services like education and water to rural and urban
poor communities. Work with indigenous structures in Somalia has also created employment
opportunities for youth. Mercy Corps embraces the principles of “Do No Harm” in all its
programming in Somalia by building the capacities to disengage; and uses grassroots, “bottom-
up” approaches to build capacities of local communities to engage in dialogue with each
other and officials.
Mercy Corps, through the USAID-funded Promoting Peace and Reconciliation Program in
Puntland and Somaliland, has worked with local communities and traditional structures of
governance to reduce violent conflict and ease social tensions. By using available indigenous
alternative dispute resolution mechanisms, Mercy Corps has helped avert conflict and built trust
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among warring communities. The program has supported dialogue forums, advocacy
messages, and community projects that addressed the causes of violence. For instance over 35
local community projects were implemented to address one of the root causes of conflict –
equitable use of natural resources. The projects included the planting of tree nurseries, income-
generating activities, vocational training, and solid waste management projects in Somaliland
and Puntland.
In Somaliland and Puntland, Mercy Corps has revitalized traditional systems of decision-
making based on councils of clan elders to strengthen traditional governance structures and
national government actors and promote accountable governance and engaged citizens.
Some of the outstanding achievements of such grassroots governance processes so far include
clan elders in Sanaag and Karkaar developing customary policies (agreed to by Puntland
authorities) to manage competition over water resources. In Warsengeli, clan elders negotiated
an agreement with the government of Puntland to provide security following clan conflicts in
Bossaso town. In all program communities, Mercy Corps advocates for the inclusion of women
and youth in the traditional set of governance structures it helps build.

On other fronts, Mercy Corps is addressing gaps in national and local government services
delivery through construction and rehabilitation of schools, water and sanitation facilities and
clearance of roads. Mercy Corps has created temporary jobs through cash for work
programs involving over 5000 young people since 2006. They programs have provided
income to the poor, educated young people on the dangers of drug abuse, and stopped
environmentally harmful practice of charcoal production.

Other good governance strategies used by Mercy Corps in Somalia include demonstrative
approaches where communities and government officials are invited to Mercy Corps
tendering and bidding processes to model and foster grassroots democracy, accountability, and
provides practical first-hand experience in planning and managing projects that address
community needs. Already government officials and local NGOs are taking increased
responsibility for projects and services that deliver tangible improvements to communities in
livelihoods, education and water and sanitation. Mercy Corps continuously engages local
government officials and ministry officials in Puntland and Somaliland to foster
responsiveness and participation.

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As part of its broader effort to create sustainable institutions and mechanisms for citizens to
participate in democracy-building and educational processes in

Puntland, Somali Family Services (SFS) strives to build


and strengthen the capacity of the Puntland government, civil society organizations (CSOs),
and local religious and secular leaders. SFS works daily to empower citizens, as well as to
help the Puntland government become responsive and accountable to the needs and demands
of local communities. To achieve this, SFS has held a variety of training exercises,
workshops and forums. It has provided computer training for half of Puntland’s Members of
Parliament, affording them the skills to better write legislation, make informed decisions and
better provide services to their constituents. This training and similar capacity building
programs for government officials have strengthened SFS’s relationship with the local,
regional and Puntland governments. SFS utilizes these relationships to open up dialogue on
critical issues among citizens, civil society and government officials.

A strong, responsive government requires an informed, active citizenry. To this end, SFS
helps improve the abilities of CSOs to aggregate and represent citizens’ interests through
capacity building trainings, workshops and forums with government officials. Furthermore,
in Puntland SFS launched its Neighborhood Colleges, a leadership and civic development
program designed to help citizens learn about local government, democratic processes, and
rights and responsibilities. By bringing together government officials and representatives of
CSOs for discussions about human rights, democratization and the future of Puntland, the
Neighborhood Colleges have helped build bridges between these two often-opposing forces.
During Neighborhood Colleges meetings, government officials explain their roles and
responsibilities to participants; describe how their day-to-day activities benefit the
community and participants; and take questions and requests from the participants. As such,
these dialogues open lines of communication between government officials and their
constituents, fostering accountability and responsiveness.

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SFS also understands the importance of empowering Somali citizens and ensuring they have
a voice in their society and government. To support citizen empowerment, in Puntland SFS
worked to divide Garowe, the capital city of Puntland, into seven neighborhoods and
subsequently created committees for each one. Members of these neighborhood committees
are responsible for serving as liaisons between their communities and local authorities, and
are also community organizers in their own right. Among other accomplishments, the
committees have organized security patrols to monitor their neighborhoods at night,
performed a poverty census, and collected and distributed food to the needy in their
communities.
Somalia has been in conflict for over twenty years and has not had a legally recognized
government for most of this period. Since the collapse of the Siad Barre government in 1991
southern Somalia has experienced cycles of conflict that fragmented the country, destroyed
legitimate institutions and created widespread vulnerability. Between 1988 and 1993 civil
war destroyed Mogadishu and Hargeisa, resulted in 50,000 civilian deaths in north-west
Somalia alone and exacerbated the 1991 famine which had 250,000 victims. Peace
conferences finally led to the formation in 2000 of the Transitional National Government, and
then the Transitional Federal Government in 2004, but both were undermined by warlordism,
mismanagement and international interference, giving rise to militia-based opposition and
today's al Shabab movement. Shaped by long years of conflict, a dynamic has developed in
Somalia's economy in which economic and political actors face incentives to perpetuate
conflict in order to sustain and divert associated revenue streams.

2. Somalia's economy and population of around nine to ten million8 remain vulnerable to
shocks. In the absence of stable institutions, the combination of conflict, environmental
degradation and harsh climate have resulted in a series of natural disasters resulting in full-
scale humanitarian crises. Somalia is still recovering from the 2011 drought, which resulted
in 260,000 deaths in Somalia and affected 13 million people in the Horn of Africa. Although
food security has improved, 870,000 people remain food insecure and an additional 2.3
million - one fourth of the population - remain vulnerable to food insecurity. Displaced by
conflict and famine, over one million Somalis live as refugees in the Horn of Africa and
Yemen and 1.1 million remain inside Somalia as internally displaced persons (IDPs). Poverty
is estimated to be 73 percent; extreme poverty 43 percent - however statistical and data work
is required to validate the country's poverty profile.

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The Federal Government of Somalia, as part of its upcoming National Development Plan, is
developing a resilience strategy to help mitigate these effects on the poor. “Resilience is
crucial for Somalia. Understanding how resilience programs will impact communities on the
ground is important. This training will enable us to measure the impact of the interventions
and guide us on how to improve, said Abdi Ahmed Mohamed, the Resilience Focal Point in
the Office of the Prime Minister, speaking at the first phase of training workshops held in the
federal capital of Mogadishu. “The partnership between the Government of Somalia and
FAO is key in achieving our goals of building resilience in the future; we’re counting on this
partnership to continue to grow for the benefit of our people,” he added.
FAO Somalia launched the first of three workshops in Mogadishu designed to build the
capacity of government institutions to carry out their own analysis on resilience and food
insecurity. Resilience assessment and monitoring the impact of interventions and policies
provides critical information on how to concentrate limited resources for better results. This
is to be achieved by improving the availability of regular, timely information as well as
evidence-based analysis on food security, nutrition and resilience by implementing the
Resilience Index Measurement and Analysis pioneered and developed by FAO. Amin Malik,
Monitoring and Evaluation Officer for FAO Somalia and Co-trainer of the workshop said,

“The result of this program will be more informed and better decision making across all
levels of government to build resilience and protect the livelihoods of Somali people.”

As of late, Somalia’s counterterrorism efforts have enjoyed some notable successes. Security
services in Puntland, an autonomous region of northern Somalia, fought off a large seaborne
assault from al Shabab last March, killing 300 militants and capturing 100 fighters in the
process. The same month, a U.S. airstrike killed more than 150 newly trained al Shabab
combatants. A joint U.S.–Somali raid killed one of the organization’s senior members three
days later.

But despite the recent victories against al Shabab, the group’s presence in Somalia has
strengthened. Peacekeeping troops from the African Union Mission in Somalia (AMISOM)
had pushed the group from its major strongholds over the past five years, but their offensive
has stalled. AMISOM still occasionally liberates areas from the group’s control, but is

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sometimes unable to hold onto them. Al Shabab, meanwhile, has managed to kill hundreds of
AMISOM troops, and has overrun three of AMISOM’s bases in the last ten months.

The Somali conflict has turned into a stalemate that benefits al Shabab. The country’s
government is still too weak, dysfunctional, and corrupt to establish widespread credibility.
AMISOM has been generally effective but lacks sufficient troops to exert consistent military
pressure against al Shabab, and the Somali National Army (SNA) is unable to pick up the
slack. This has allowed al Shabab to survive and continue its terror campaign that costs lives
and stymies progress. The Somali government and the international community need to act
urgently to ensure the costly, fragile gains of the last five years do not slip away.

END OF THE ROAD

Barring strategic changes, AMISOM’S offensive has gone as far as it can. The force consists
of about 22,000 troops from five countries, as well as almost 400 police officers. Yet it is
trying to subdue a terrorist group that operates throughout a country nearly as large as Texas.
Counterinsurgency doctrine suggests that, given Somalia’s approximately 10 million
inhabitants, at least 47,000 effective troops are required, meaning AMISOM is facing more
than a 50 percent manpower shortfall. It also frequently suffers from a breakdown in basic
military command and control. During attacks, troops often report to their home capitals
before checking in with command and control in Mogadishu. This leads to confusion and
delays that cost lives.

Countries participating in AMISOM sometimes put national self-interest above the


coalition’s mission as well. Ethiopian forces operated independently from AMISOM inside
Somalia for a number of years before eventually joining the coalition, and many Somalis are
suspicious that Ethiopia wants to keep their country, historically Ethiopia’s greatest foe, weak
and divided. And the United Nations alleges that the Kenyan Defence Forces defied an
international ban on the the chargcoal trade, which finances much of al Shabab’s activities, in
order to get a cut of the revenues.

The SNA should be the solution to some of these problems. Unfortunately, it remains largely
ineffective and disorganized, save for a few elite units. The army was cobbled together from
Somalia’s clan-based militias whose primary loyalty remains with their respective clans,
rather than with the central government.

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The international community has spent hundreds of millions of dollars training the SNA to
improve its capabilities, but to little effect. In fact, the training is a part of the problem. The
African Union, European Union, the United States, and the United Arab Emirates have
trained SNA units, leaving behind an army with little cohesion. Units receive different
instructions and trains with different techniques, making coordination difficult.

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FEISAL OMAR / REUTERS
Residents look at the wreckage of a car destroyed when Islamist militants opened fire on
government officials in a car and then a car bomb exploded, according to police and a
spokesman for Mogadishu's mayor, in Yaqshiid district of Somalia's capital Mogadishu, April
18, 2016.

Somalia’s political challenges are equally difficult. The international community threw its
support behind President Hassan Sheikh Mohamud in 2012, hoping he could provide a break
from the string of corrupt, ineffective transitional governments of the past. The United States
reestablished diplomatic ties with Somalia for the first time in 20 years, and a handful of
countries, including China and the United Kingdom, reopened their embassies in Mogadishu.
It was clear that rebuilding Somalia would be a challenge, but the conditions seemed better
than they had in decades.
Mohamud’s government has proven to be a disappointment, however. In 2013, the United
Nations accused his regime of being flamboyantly corrupt, claiming that 80 percent of Somali
Central Bank transactions were fraudulent. The same year, Somali Central Bank Governor
Yussur Abrar fled the country seven weeks into her post, claiming that her life was in danger
after she thwarted attempts by high-ranking officials to loot the bank.

The government also spends too much time convulsed by power struggles and bickering.
Mohamud forced two of the country’s previous prime ministers out of office due to
disagreements over how power should be divided between the two offices, and Somali
parliamentarians tried to have the president impeached on corruption charges in 2015. The
disruptions have slowed the pace of important reforms. Parliament took more than a year and

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a half to pass a measure designed to bring transparency to public procurement. Other good
governance measures, such as establishing an Ombudsman position to investigate
government abuses, have languished as well.

BREAKTHROUGH SEASON

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It will take tough adjustments to break Somalia’s political and military stalemates.
Mogadishu must enact the promised anticorruption reforms, and prove it can advance a fair
agenda through a political system fissured with clan rivalries. The government has been
victimized by unclear constitutional provisions governing some of the most contentious
issues, yet it needs to show more of the resiliency and statesmanship necessary for leading
such a damaged and fractious country.

Creating a self-reliant and effective SNA must remain an urgent priority, as AMISOM cannot
end its peacekeeping mission until an indigenous military can ensure security. A single
country or organization should take responsibility for training the SNA, which would help
improve its tactical abilities and culture. For now, however, AMISOM is still the country’s
largest, most coherent fighting force. Its headquarters must facilitate better coordination
among its constituent military contingents, which in turn must better observe command and
control protocols by coordinating their actions through AMISOM. AMISOM should also be
supplied with badly-needed airlift capability, the lack of which has contributed to its bases
getting overrun and made it difficult to corner al Shabab. Finally, troop-contributing countries
must surrender any agendas that do not wholeheartedly support a stable Somalia.

The international community and Somali government need to recapture the momentum they
had in 2012. Otherwise, they will face further strengthening of a terrorist group that has killed
thousands in Somalia and neighboring countries, and which at one point attracted recruits
from around the world, including scores from the West. That would be a dangerous,
unacceptable outcome.

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CHAPTER-V

FINDINGS

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findings

Somalia's entrepreneurial private sector community is one of the country's main assets and an
important partner for development actors. Despite a long period of instability, three industries
have thrived: livestock, remittance services and telecommunications. The livestock trade
remains the backbone of the economy: 60 percent of the population derives a livelihood from
pastoralism-based livestock production. In the absence of a formal commercial banking
sector, remittance companies have enabled the diaspora to remit around US$1.3 billion
annually to families in Somalia. Telecommunications companies employ around 25,000
Somalis, generate substantial profit and have enabled a mobile penetration rate of 20
subscriptions per 100 people. While these achievements are impressive, further growth is
constrained by underinvestment, insecurity and inappropriate or absent regulation. This is
reflected in low internet penetration rates (one of the lowest in Africa); the unsustainable
management of natural resources and rangelands that threatens the livestock trade; and
remittance companies facing exclusion from international transactions in the absence of a
sound domestic regulatory framework that is enforced. A dialogue between public authorities
and the business community is required to establish consensus on the role of the state in the
market and the economy, and the value that appropriate regulation can bring in restoring
public confidence and fostering private investment. This issue is also pertinent to the delivery
of social services, where the private sector remains the key provider of health and education
services.

Following an 18 month period of important military gains in southern Somalia,


improvements in the security situation stalled in early 2013, and conditions on the ground
remain volatile. The African Union force - AMISOM - has played an important role in
retaking key cities in the south opening the way for political dialogue and stabilization.
However, with increased territory to hold in central and southern regions - and with no
additional troops or force enablers - AMISOM is operationally stretched. Meanwhile a
leadership struggle within the insurgent group al Shabab has resulted in a campaign, during
2013, of asymmetric, high profile attacks on the government and its international military and
civilian partners. The June 19 attack on the UN compound in Mogadishu and the Nairobi
Westgate Mall attack in September demonstrate the movement's evolution into an extremist
and increasingly internationalized militant group.

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SUGGESTION

Somali society is highly segmented, complicating the development of a unifying vision of the
Somali state. Somalia's political development has been oriented around clan and geography-
based identities, where groups resolved disputes through a system of collective compensation
and consensus. More recently, competing concepts of the state in Somalia have manifested
themselves in stark and often violent opposition, and today defacto authority remains
contested between traditional, customary, religious and modern institutions. Which
institutions are vested with the authority to direct state formation is itself a source of dispute,
complicating the process to establish local and regional administrations. While the legal
framework evolves, political negotiations - as in the case of the recent Jubbaland agreement -
will continue to play a key role. This process is further complicated by actual and anticipated
competition over access to and division of revenue streams, land, grazing, water and the
potential exploitation of sub-soil assets1 3 ; in other words the sharing of Somalia's wealth
and resources.

10. In the absence of an effective strategy to generate livelihoods and jobs, Somalia's
interlinked crises of unemployed youth, forced displacement, contested land, drought and
natural resource depletion will always present a risk to Somalia's peaceful development. An
input for the UN's strategic assessment mission in 2012 noted that "the wider humanitarian
and livelihood context of Somalia remains alarming, and is a critical contextual factor for
conflict and political violence. Rates of internal displacement, food insecurity, and
unemployment are extraordinarily high, as are the number of refugees in neighboring
countries. This creates a large cadre of idle young men who are easily recruited into criminal
gangs, clan militias, or jihadi movements."1 6 UNDP's Human Development Report 2012
reported that youth were already major actors in the conflict, constituting the bulk of the
participants in militias and criminal gangs, including al Shabab.17 Overall unemployment
among people aged 15 to 64 is estimated at 54 percent in Somalia, up from 47 percent in
2002. Somalia's youth (aged 14 to 29) unemployment is 67 percent - one of the highest rates
in the world, warranting its special focus in the Compact priorities.

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CONCLUSION

In Somalia, up to 931,000 people remain in crisis and 22,000 more in emergency. In total 4.7
million people, 38 percent of the population, are acutely food insecure and struggling to meet
their minimum daily food needs. Households belonging to this group remain highly
vulnerable to major shocks, such as drought or floods, which could easily push them back
into food security crisis. Linking information on resilience, food security and nutrition to
policies and programs is key for decision making. Insecurity and conflict continue to
contribute to poor household food security and high malnutrition rates, with communities
recovering from many seasons of failed rain and subsequent drought. As the situation is
fragile, any gains made to food security and nutrition could be lost without continued good
governance.
For the first time, the Food and Agriculture Organization of the United Nations (FAO) in
Somalia is providing technical support to both Federal and State Officials, as well as
universities, in the form of quality access to data and information to conduct resilience
analysis on a national level. INFORMED (Information for Nutrition, Food Security and
Resilience for Decision Making) is a global program coordinated by FAO’s Agricultural
Development Economics Division (ESA), funded by the European Union and implemented in
Somalia by FAO’s Resilience Team for Eastern Africa (RTEA) and its Somalia Office,
aiming to increase the resilience of Somali people and reduce food insecurity and
malnutrition.

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Reference
93. In view of the foregoing, the Independent Expert recommends that the Federal Government:
(a) Ensure the implementation of the Security Pact agreed at the London Conference on Somalia,
particularly in respect of security and justice reforms;
(b) Conclude the process of establishing the national human rights commission by recruiting the
members of the commission and its staff, and ensure that they are trained and that adequate resources are
allocated for their work;
(c) Accede to and ratify international instruments such as the Convention on the Elimination of All
Forms of Discrimination against Women, the Convention on the Rights of Persons with Disabilities, the
Convention on the Prevention and Punishment of the Crime of Genocide, the Rome Statute of the International
Criminal Court and Additional Protocols I, II and III to the Geneva Conventions of 1949;
(d) Allocate resources equitably between the Federal Government and the federal member states;
(e) Establish skills development centres to empower women, young people and members of
minority groups;
(f) Guarantee the rights of journalists and the freedom of the media, and finalize the ongoing
review of the media law to bring it into line with international standards on media rights guaranteeing freedom of
expression;
(g) Continue the reform of the traditional justice system, and conduct advocacy activities to ensure
that traditional elders do not perpetuate discrimination and violence against women;
(h) Raise awareness among traditional leaders about human rights, particularly civic education and
the rights of women;
(i) Finalize the review of, and raise awareness about, the new sexual offences bill;
(j) Strengthen the capacity of all ministries to enable them to carry out their mandates;
(k) Increase the resources allocated to the ministries and institutions responsible for the
administration of justice and the protection of human rights, particularly the Ministries of Women and Human
Rights Development at the federal and state levels, the judiciary, the police and the correctional services;
(l) Increase the number of women appointed to the judiciary and to institutions for the
administration of justice, and the number of female police officers and prosecutors.
94. The Independent Expert recommends that the federal member states:
(a) Ensure that they fully coordinate with the Federal Government in matters of State-building and
security institutions, including the national security architecture and the justice sector reforms;
(b) Adopt laws, such as sexual offences legislation, where they have not done so, on the protection
of the rights of women against sexual and gender-based violence;
(c) Adopt comprehensive legislation, where they have not done so, to guarantee freedom of
expression and opinion;
(d) Appoint more women to federal member state institutions, including the judiciary, police force
and other institutions for the administration of justice.
95. The Independent Expert recommends that the international community:
(a) Support the Federal Government and federal state governments in promoting a sense of
ownership of the Security Pact by the Somali people to ensure their participation in its implementation, and
continue its support for the stabilization process in Somalia by providing adequate resources;

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