Somalia has been drifting toward a new war since the Transitional Federal Government (TFG) was formed in late 2004 but the trend has recently accelerated dramatically. The stand-off between the TFG and its Ethiopian ally on the one hand, and the Islamic Courts, which now control Mogadishu, on the other, threatens to escalate into a wider conflict that would consume much of the south, destabilise peaceful territories like Somaliland and Puntland and possibly involve terrorist attacks in neighbouring countries unless urgent efforts are made by both sides and the international community to put together a government of national unity.

The Islamic Courts’ success, and the rise to prominence of hard-line jihadi Islamists within them, has alarmed neighbours and sent shock waves through the broader international community. Ethiopia, which suffered terrorist attacks by al-Itihaad al-Islaami (AIAI) in the mid-1990s, considers the Courts a direct threat. Kenya is alarmed by links between key figures within the Courts and individuals of concern within its own borders. The U.S. believes jihadi Islamists within the Courts shield al-Qaeda operatives responsible for bombing two of its embassies in 1998. All share determination not to allow Somalia to evolve into an African version of Taliban-ruled Afghanistan. Meanwhile, the Transitional Federal Government is increasingly perceived within Somalia as a faction rather than a national authority and is so wracked by internal dissent and the accelerating defections of cabinet ministers that it threatens to fall apart.

The TFG and Ethiopia paint the Islamic Courts – far too simplistically – as a terrorist umbrella, backed by thousands of foreign jihadi fighters, and Ethiopia has threatened to “crush” them if they move against the TFG. The Courts have responded to Ethiopian deployments in Somalia by calling for a defensive jihad and breaking off peace talks under Arab League auspices. Skirmishes between TFG and Islamic Court forces south of Mogadishu in late July were widely perceived as the first exchanges of a coming conflict. Unless the crisis is contained, it threatens to draw in a widening array of state actors, foreign jihadi Islamists and al-Qaeda. Moreover, Eritrean assistance to the Courts has made Somalia an increasingly likely proxy battlefield between long-feuding Eritrea and Ethiopia.

The roots of the crisis are profoundly parochial and have more to do with practical power, prestige and clan issues than ideology. The core of the dispute is the TFG’s failure to make itself a genuine government of national unity and the emergence of the Islamic Courts as a platform for opposition from large sections of the Hawiye clan – probably the largest, most powerful kinship group in southern Somalia. The Courts are a loose coalition of Islamists, including many moderates, who have built a well-trained militia and independent funding sources.

The situation is, in part, a by-product of the long decline of Mogadishu factional leaders, who a decade ago monopolised political representation in the country but have gradually faded, creating a political vacuum filled by the Islamists. Their decline has multiple causes, including unwillingness to provide basic services and rule of law in areas they controlled and the rise of rival business elites. The clan-based Sharia court system in Mogadishu, which began a decade ago as a local mechanism to deal with chronic lawlessness and is almost entirely affiliated with Hawiye lineages, is valued by local people and business interests as one of the few sources of local governance in the south. Its ascent has radically altered Somali politics. Since the Courts defeated prominent faction leaders in four months of heavy fighting in Mogadishu this year, they have consolidated their grip on the capital and its environs, establishing a new political force in the south which threatens to eclipse the fragile TFG.

Ironically, the crisis is a direct product of ill-conceived foreign interventions. Ethiopia’s attempts to supplant the earlier Transitional National Government (2000-2003) with one dominated by its allies alienated large sections of the Hawiye clan, leaving the TFG with a support base too narrow to operate in and near Mogadishu. The calls of the African Union and the Intergovernmental Authority on Development (IGAD) for foreign peacekeepers, intended to bolster the TFG, have instead cast it as ineffectual and dependent on foreign support, and provided a rallying cry for diverse opposition groups. U.S. counter-terrorism efforts meant to contain foreign al-Qaeda operatives have accelerated the expansion of jihadi Islamist forces and produced the largest potential safe haven for al-Qaeda in Africa.

Decisive international action to contain the Somali crisis is long overdue. Diplomatic initiatives have tiptoed around the core issues: any negotiated settlement must reconstitute the TFG as a genuine government of national unity, including credible leaders from both the Islamic Courts and the broader Hawiye community; the TFG’s draft National Security and Stabilisation Plan (NSSP) must be revised to reflect new realities on the ground; and agreement must be reached on a phased return of the federal institutions to the national capital, Mogadishu. An independent, broad-based constitutional commission should be established, as per the Transitional Federal Charter, in order to provide a forum for dialogue over the structure and legal foundations of the Somali state.

There is no ideal candidate to lead this initiative among the many international organisations and countries active in and about Somalia. Each has weaknesses, including often the perception by the TFG or the Islamic Courts of prejudice. Crisis Group believes the UN is best placed to take on the challenge but it will need to work collegially with the others, its in-country presence should be reinforced and its leverage must be increased by vigorous Security Council support.

Nairobi/Brussels, 10 August 2006