Anger in Somali capital at Kenya cash transfer freezes

Mogadishu (AFP) - Residents of Somalia's capital Mogadishu on Thursday condemned as "collective punishment" Kenya's shutting down of money transfer services to the country over suspected links to the Al-Qaeda-linked Shebab.

Kenya on Wednesday froze key transfer companies vital for impoverished Somalia, as part of a crackdown on alleged Shebab supporters following the university massacre of almost 150 people by the Islamists last week.

"It is a bad decision that collectively punishes the Somali people," said Abdisalim Mohamed, a resident in Mogadishu.

"It is already affecting me directly, because I cannot get money and help from my daughter, who has a business in Kenya."

With no formal banking system in the impoverished country, diaspora Somalis use money transfer services to send cash back home to support their families, sending some $1.3 billion (1.1 billion euros) each year, dwarfing foreign aid.

Kenyan President Uhuru Kenyatta on Saturday warned Shebab fighters his government would respond to the killing of 148 people at the university in Garissa in the "severest way" possible, with warplanes on Monday attacking Islamist bases in southern Somalia.

But Kenyatta also warned that the masterminds behind last Thursday's attack were inside Kenya, not Somalia.

Somalis, like Kenyans, are struggling to combat the Shebab -- and now they say Nairobi's decision is harming them.

"It is sad that the same people who are victims of Al-Shebab here, are also being punished because of Shebab," said Samira Hussein, a mother of five who works in Somalia, but whose husband and children are in Kenya.

Kenya's police on Wednesday issued a list of 85 people and businesses with suspected links to the Shebab, with the top name alleged Islamist commander Mohamed Mohamud, a Kenyan said to be the mastermind behind the university massacre in Garissa.

But the list also included money transfer companies, including Dahabshiil, one of the most important transfer companies across the wider Horn of Africa region.

Somali President Hassan Sheikh Mohamud this week said "remittances are a critical lifeline to millions in poverty."

- 'Devastating consequences' -

The Shebab fled their power base in Somalia's capital Mogadishu in 2011, and continue to battle the AU force, AMISOM, sent to drive them out that includes troops from Burundi, Djibouti, Ethiopia, Kenya and Uganda.

The group has warned of further revenge attacks in neighbouring countries, notably Kenya and Uganda, in response to their participation in the AU force.

"It would better for Somalis that Kenya pulls its troops out of Somalia than stop remittances," said Mogadishu resident Ahmed Moalim Dahir.

The restrictions are also hampering business transactions.

Abdullahi Ahmed, who works for an international aid agency in Mogadishu, said that if Kenya maintains the ban -- currently blocking him from receiving his salary from Nairobi -- organisations and businesses would be forced to shift operations elsewhere.

"It will hit Kenya economically, because organisations will move to another country, like Djibouti," Ahmed said.

Banks in the United States and Europe have previously also moved to shut the transfer services, with aid agencies warning of "devastating consequences" from those measures.

"Hundreds of people are showing up here to get money from relatives, but after the Kenyan decision, people have to look for alternatives," said Mohamed Jamal, working in a Dahabshiil office in Mogadishu.

Somalia has been unstable since the collapse of Siad Barre's hardline regime in 1991, with the country's internationally-backed government, along with African Union forces, currently battling the Shebab.

Stopping remittances "would only compound the misery of a population cowed by terrorism," President Mohamud added.

But it is not only in Mogadishu the impact is already being felt.

In the Kenyan capital Nairobi, those in the largely ethnic Somali district of Eastleigh said the move had sparked frustration, with people arguing that those wanting to send cash to support the Shebab would still find easy ways to do so illegally.

"Closing the remittance companies was a bad idea - and it has nothing to do with security measures," businessman Mohamed Khalil said. "What the government should do is focus on intelligence based information."