Category Archives: Urbanization

Risky business and refugee capitalism – the Somali township economy in South Africa

This article is a brief overview of the findings of the article “Risky business and geographies of refugee capitalism in the Somali migrant economy of Gauteng, South Africa” in the Journal of Ethnic and Migration Studies. This piece builds on two previous pieces written with Richard Grant, which appeared in Urban Geography and Urban Forum; a summary of them can be found here.

The article is available for download here: 

“Risky business and refugee capitalism” are the terms used to describe the primary aspects of Somali migrant life in South Africa. “Risky business,” because the majority of young Somali male migrants who are able to find employment in South Africa work in retail shops in South Africa’s townships where livelihoods are earned at high risk of robbery, injury, or even death during daily violent crime or flare-ups of anti-immigrant violence (such as those in 2008 and 2015, dates which frame the 2010-2012 study period). “Refugee capitalism,” because many of these retail stores are owned by groups of investors who do not work on the premises, contrary to previous discussions of immigrant “bootstrap entrepreneurship” and immigrant self-employment. In fact, one of the main findings of the research that went into this article is that the Somali migrant economy involves a lot of investment from Somalis living in North America or Europe who use family networks and Somali money transfer operators (commonly called hawala/hawilaad [plural]) to invest in South African businesses, where, by all accounts, there is money to be made.

What is interesting is the way in which the local economic geography of Somali business—by which I mean the way that business dynamics map specifically onto the urban geography of the Gauteng City-Region (Johannesburg and Pretoria and their surrounds)—are connected with international circulations of people and money. This is what the article explores, showing how the Somali ethnic enclave in Mayfair, Johannesburg links the international circuits of the Somali diaspora economy with the specific South African township retail niche where most Somalis in South Africa find profitable investment opportunities.

Now a word about background for those readers who are perhaps less familiar with the South African context. For most of the 20th Century, South Africa was ruled under the apartheid system, which enforced a strict racial segregation by creating areas of the city in which certain racial groups could live. Even after the apartheid system was replaced by democratic governance in 1994 (with Nelson Mandela becoming the first democratically elected president of the Republic of South Africa), racial groups remained heavily divided both socially and geographically. The term “township” refers to settlements on the outskirts of South Africa’s cities to which Blacks were relegated during apartheid. Particularly in Gauteng Province, most townships remain predominantly Black, whereas Whites, Indians, and others are more likely to live in more central areas (actually, the inner city of Johannesburg was largely abandoned in the 1990s as Whites moved out to the northern suburbs, but that is a topic for another time). Townships are also commonly called “locations” (a reference to enforced segregation under apartheid), and I use the terms interchangeably.

As South Africa’s economy grew from the 1990s onwards, Black South Africans in the townships gained purchasing power, but the dynamics of the job and real estate markets left many still unable to find formal employment or move closer to the cities. Thus, huge segments of South Africa’s population live in the townships surrounding the cities, and since South Africa implemented a pension system, many people scrape by with marginal employment or informal entrepreneurship. Nevertheless, people need basic goods. This provides the context for an exploration of Somali township businesses: “Historically, most townships were residential zones where Blacks were barred from conducting formal business. The collapse of apartheid opened opportunities for entrepreneurs to bridge spatial divisions by purchasing goods from urban (usually White or Indian) wholesalers and re-selling them in marginalized and sometimes dangerous areas where many business people were reluctant to take the risk” (p. 5).

When I say “Somali”…

It does not necessarily mean just Somalis, in this context—and certainly not just Somalis from Somalia. Individuals identifying as ethnic Somali and speaking Somali as a first language also come from Kenya, Ethiopia, and Djibouti (and Somaliland, which is functionally independent from Somalia though not recognized as an independent country by the powers-that-be). And tied closely to the Somali community in South Africa and elsewhere are closely related groups such as Oromo and Gabbra, as well as Muslims from coastal Kenya and Tanzania.

“Two contexts of violence—war at home and xenophobia in South Africa—frame Somali identity and experience in South Africa, frequently described along the lines of ‘out of the fire, into the frying pan’ … After arriving in South Africa, many Somalis look for opportunities to move on to other countries. A number of men working in the townships send money to wives and children left behind in Kenyan refugee camps to await resettlement. Husbands then seek to re-join their families if the wives and children are selected for refugee relocation to Europe or North America” (p. 6). This observation pertains to a number of the informants for this study, who sent money to their families until their wives and kids were relocated overseas, and then embarked on the lengthy process of proving marriage and paternity in order to become a refugee in North America, where life is considered better than it is in South Africa.

The township retail economy

This article is certainly not the first to point out the danger that immigrants face in South Africa’s townships; the study cites several others that provide statistics on anti-foreigner violence, which “is most likely to occur in poor (but not the poorest) townships with a high population of young males (Polzer 2010)” (p. 7). A later section of the article observes that it is not just South African nationals who engage in anti-foreigner violence; foreigners themselves frequently fight each other, and the Somali economy is rife with rumors about Somalis paying South Africans to target other businesses. The study quotes one informant who states that Somalis shoot each other over business competition in South Africa’s townships.

In this context, the distribution of risk is rather striking. Employees bear the brunt of physical risk, willingly placing their lives on the line on a daily basis in order to provide for their families. Investors, as is customary in Somali culture, tend to spread risk by holding shares in multiple businesses. Often it is family and clan networks that provide workers with employment and create connections across the worker/investor distinction. One of the most interesting stories for me is the story of Q in the article, who worked for his uncle. He provided the following story, described on p. 8 of “Risky Business”:

“[Thieves] killed in my uncle’s shop in the locations … They killed two guys; they shot them… My uncle called me. I left my job here [in Mayfair] and went to my uncle’s shop…. My uncle gave me a gun. He said I must stay there. I was working—me and my uncle’s brother’s son were there—only the two of us…. Early in the morning they came to us—the same guys who killed those [other Somali workers]. They just tied us up. That day I survived. I could have died. I told [my coworker], ‘Give whatever money you have. Let them take it’. Because life is more important than money” (p. 8).

The motivation for continuing to undertake such risky work is the obligation of sending remittances to family members at home in the Horn of Africa. Remitting money is expected; it is “compulsory”; it is the main reason why many informants arrived in South Africa in the first place. The township shop economy offers the possibility of remitting the expected amount (usually about $150 per month), and sometimes workers can make enough in a month to save up money and eventually become a shareholder in a shop, or even purchase their own shop. Although the sample size was not sufficient to get a significant T-test result, the difference in income between shareholders and employees is telling: Shareholders reportedly earning from $650 to about $900 per month, with an average of $780. Employees’ incomes ranged from $150 to $300, with an average of around $260. Employees surveyed reported remitting about 54% of their incomes, whereas shareholders reported remitting about 40% on average. In the townships, Somali workers live inside the shop and usually eat from the stock which is purchased wholesale, so living expenses are minimal. ‘The small amount of start-up capital required and the high turnover make the locations a potential stepping-stone for entrepreneurs. ‘In town, actually, the sales are so small. In the locations it’s better’, reported one informant who in 2011 became a shareholder in a large shop in Pretoria West after working in other locations for over seven years. ‘That’s our foundation we started from’” (p. 9).

The Eighth Avenue ethnic enclave

Richard Grant and I had written about some of the dynamics of the Eighth Avenue Somali enclave in earlier articles, and the JEMS piece shows more fully how the geographies of Somali migration are linked through this space. The several blocks along Eighth Avenue that some informants called Johannesburg’s “little Mogadishu,” serve as the hub of Somali migrant social and economic infrastructure. Social infrastructure, in that it is the place to go if you want to find a job, and also the place to go if you want to hang out with other Somalis, eat Somali or Oromo food, chew qat, or generally relax and take a break from the dangers of township work. The economic system is grounded largely in the Somali money transfer system (hawilaad), through which investors send money to South Africa and migrants in South Africa send money to family members in the Horn or elsewhere.

Business in the Somali ethnic enclave is based largely on circulation, rather than on production. Most of the businesses involve food, money transfer, lodging, and technology (Internet cafés are popular). The second part of the JEMS article explores these dynamics more deeply and shows how they create forms of investment and urban upgrading in Mayfair. One of the main points in this section was to explore how “cosmopolitan” disembeddedness—a topic of conversation in the work of migration specialists—may produce forms of visible investment and become “grounded” in the infrastructure of a neighborhood or city. I don’t really buy distinctions such as “locals” versus “cosmopolitans,” and I show why by indicating how an individual’s practices can change over time from more locally-grounded interests to broader horizons such as international refugee resettlement. Only time will reveal the long-term dynamics of investment and circulation that will change Mayfair, probably in unpredictable ways.

Just the beginning

One problem with academic writing is that by the time it is published, it might be out of date. Things change rapidly. I have since shifted my work back northwards to the Horn of Africa, but I will continue to explore the intersection of mobility, finance, and political-economic geographies in my other work. I hope that “Risky business” will provide a useful jumping-off point for others who wish to engage with the ways in which Somali life in South Africa is changing, and how various scales and types of international linkages are created and navigated in the shifting South African setting.

“The State of Post-conflict Reconstruction” in Juba, South Sudan by Naseem Badiey (Book Review)

The State of Post-conflict Reconstruction: Land, Urban Development and State-building in Juba, Southern Sudan. By Naseem Badiey. James Currey Press, 2014.

The title of this book hints at the convergence of several fascinating topics, and situates the work within a growing literature relating national politics to more localized experiences. The intersection of urban perspectives and broader political dynamics also gets at something that is a focus of this website, which is why I am posting this review in the blog. Southern Sudan, subsequently South Sudan after independence in 2011, offers a relevant site for case studies of state-building, given its various claims to fame as the newest, most underdeveloped, and perhaps among the most politically fragmented nation-state in Africa. This book offers a fascinating exploration of perspectives on state-building and development and situates urban politics within broader fields of power in its critique of “top-down” planning and state-building. However, the attempt to render generalizable conclusions and the brief discussion and development of the author’s specific case studies leave something wanting in the analysis.

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Xenophobia and Immigrant Business in South Africa: East Africans in Johannesburg

The xenophobic attacks in South Africa earlier this year highlighted the tenuousness of migrant life in South Africa. South African attacks on foreigners are overwhelmingly directed at African immigrants (particularly Somalis working in South Africa’s townships), although recently Bangladeshis and Pakistanis have been targeted as well. The flare-ups in early 2015 are only heightened versions of what many migrants experience on a day-to-day basis in South Africa. Violent forms of exclusion from the “host society” (which is not necessarily a unitary entity in itself) structure immigrant business practices; and importantly, it is not only South African nationals who cause problems for African immigrants. Two articles that we recently published in academic journals highlight immigrant business strategies and the differentiation between and within certain immigrant groups within the context of post-apartheid Johannesburg. Below I provide a brief overview of the articles and include links to the publishers’ pages.

The first article, published early this year, focused on broad immigrant business strategies and experiences of African immigrants in three areas of Johannesburg. In “City on edge: Immigrant businesses and the right to urban space in inner-city Johannesburg” (Urban Geography), Richard Grant and I drew on nearly a year of fieldwork in three neighborhoods of Johannesburg to sketch a comparison of how the business strategies of different immigrant groups mapped onto the urban landscape of post-apartheid Johannesburg. The study compared business dynamics and immigrant viewpoints on life in South Africa in three areas known as immigrant-dominated neighborhoods in and around Jo’burg’s inner city: the Jeppe/Delvers Ethiopian business district, the Somali ethnic enclave in Mayfair, and the diverse area along Rocky/Raleigh Street in Yeoville.

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Jijiga (Jigjiga), Ethiopia: Jijiga Travel guide for the capital of Somali Regional State

Jijiga is booming, in terms of population growth, infrastructural growth, investment, and business opportunity. The capital of Somali Regional State, Jijiga (also spelled Jigjiga) has expanded dramatically over the past five years of enhanced peace and security in the region. Having just returned from a month-long visit to Jijiga, I am writing this post as a brief synopsis on travel conditions and recommendations.

By local accounts and by my observation, the area is very calm and secure on a day-to-day basis, though longer-term regional security trends along the Somalia Border remain somewhat uncertain – particularly several hundred kilometers south of Jijiga, past Gode. People in Jijiga generally report that they are very happy with the government’s efforts to bring about security and development, and the construction boom and huge influx of diaspora returnees bear testament to perceptions of peace and opportunity among the global Somali community. If you are going around town after dark, you will need your passport because police checkpoints are fairly common (going across town between 10 PM and midnight, I usually encountered one or two checkpoints). Of course, anywhere you go you must take some precaution, but on the whole my experience spoke to the safe and welcoming atmosphere of Jijiga.

Travelers from Europe and North America are likely to meet many compatriots in Jijiga. About halfway through my visit I was walking down one of the side roads in the morning and a young woman rode up beside me on a bicycle, chewing an ‘adey (tooth-brushing stick) and with her face covered in facial cream. “Hey man, where’re you from?” She asked. “I’m from the US,” I replied.

“Hey, me too! I’m from Minneapolis! My name’s Farah. I’ll see you around!”

The diaspora is in the house.

Jijiga’s Development Boom

Sayyid Mohammed ‘Abdille Hassan, the “Mad Mullah” who plagued the British by leading a 20-year anti-colonial struggle at the turn of the 20th century, leads the charge of progress in Jijiga’s main roundabout (in statue form). On either side of the main road that runs East to West, new hotels and office complexes are going up quickly. It is fascinating how straight buildings emerge from the crooked scaffolding used during construction. Diaspora investment and government infrastructure development are two of the main forces driving this infrastructure boom. Diaspora returnees (called “Qurba Joog” in Somali) are taking advantage of the invitation offered by the Somali Regional State government, and invitation that has become the subject of numerous songs inviting the Qurba Joog to return and invest in the development of the Horn of Africa. Featuring prominently among the new buildings is a G+5 financed by Kaah, a Somali bank that has long provided financial transfers across far reaches of the globe.


Downtown Jijiga, June 2015. Copyright D.K. Thompson.



Kaah Building

Kaah Building, nearing completion. The Ethiopian Airlines office in Jijiga is located on the first floor and several banks are on the ground floor facing the exterior. Copyright D.K. Thompson, 2015.

Getting to Jijiga

International travelers will land in Addis Ababa before proceeding to Jijiga. You can fly to Jijiga on Ethiopian Airlines, or to Dire Dawa and take a 2.5-hour bus ride to Jijiga. Alternately, you can take a bus from Addis Ababa, which will take between 9 and 11 hours. If you are not in a hurry, I recommend the bus, as it is cheap (350 ETB, or about $15 US) and takes a beautiful route through the eastern highlands. Selam Bus and Sky Bus are up to Western standards and boast very good safety records. I cannot recommend the cheaper local buses (they may be fast, but the road is also winding and dangerous, and you will probably see some minibuses and trucks wrecked on the side of the road along the way). Selam Bus and Sky Bus leave from Meskel Square, Addis Ababa. Get tickets a few days in advance, as the buses leave very early in the morning and will probably be full.

Once in Jijiga

  1. Money: There are several ATMs in Jijiga that accept international VISA and Mastercard bank cards. One is located at the Commercial Bank of Ethiopian, Fafan Branch, on the main street near the pedestrian bridge on the west end of town. Another is beside the Bank of Abyssinia, two streets west of Sayyid Mohammed’s statue and just south of the main road.
  2. Transportation: The three-wheeledBajaj, an import from South Asia, is the vehicle of choice in Jijiga. Many of the drivers speak some English, but perhaps practice some Somali and/or Amharic before you go if you don’t speak them already (I’ve transliterated a few Somali examples below).
    1. “Wahaan rabaa inaa tago ______” (I want to go to ______)
    2. “_____ ii gee” (Take me to _____)
    3. “Waa immisaa la’agtii” or “Qaymiga waa mahay” (How much is it?)
  3. Lodging: Before coming to Jijiga, I looked at a travel guide that mentioned Nogob Garden, Hamda, and Bada hotels. When I was on the bus from Addis Ababa, I asked some people from Jijiga what was the best hotel and someone recommended Universal Hotel, so that is where I stayed during my visit. It is very clean, the staff is extremely friendly and helpful, and it is in a rather quieter area of town than Hamda or Nogob Garden, both of which are on the main road (but on opposite sides of town). The newly opened City Crown Hotel just north of Jijiga city center is another option; it is located on the main north-south road. Nogob Garden, Universal, and Safari Hotel are all out on the east side of the city, near the University and closer to the airport. From that side it’s about a 20-minute walk or a 15-birr bajaj ride (or 2 birr by Force with several other passengers) to the center of town.
  4. Food: Hilib geel (camel meat) and ‘aano geel (camel milk) are a must in Jijiga. For the full Somali experience, I recommend Raaho restaurant (Raaxo), near the town center. Given the heavily gendered dynamic of public space in the culture here, I have to say that I recommend this for men only. There are only Somali men eating there, as far as I have seen. It is the stereotypical Somali place, with people seeming to yell at each other (you would think they were about to fight, but then they shake hands and hug), pushing to get to the water tap to wash hands, and sloshing maraq (soup) from bowls onto the tables as the bowls are passed around. Try the camel hump meat, but don’t eat too much. If it’s your first time, expect your stomach to run a little bit later in the day or the following morning. Also ask around and you will find the opportunity to milk camels either at a small farm inside Jijiga or at a number of locations on the outskirts of town.
  5. Food from smaller vendors is cheap and delicious. You can find plates of fresh injera for about 10-15 birr (50-75 cents US) that will fill you up. Look for any of the little restaurants tucked away behind flimsy corrugated tin walls.The hotels all have restaurants as well, but tend to be a little more expensive. Expect to pay around 60-100 birr ($3-5 US) for a meal for one person. Amira’s and Ayaan’s are restaurants near the old location of the Taiwan Market just south of the main road in the town center. Both are good. Among the best options in my opinion is Qarrijiqood, owned by diaspora investors but managed by local guys. Qarrijiqood Restaurant is located between the Regional President’s compound and the new Taiwan market. The cooks are top-notch, the restaurant provides free wireless to customers, and seating options range from outdoor tables to traditional seating on the carpets in the rear of the restaurant.

If you are planning to travel to Jijiga and would like a trustworthy guide to show you around town, please contact me and I can provide contacts for some drivers who grew up in the area.