The declaration, in Kenya, of a Transitional Federal Government (TFG) in October 2004 was heralded as a breakthrough in Somalia's protracted crisis of statelessness and civil strife. But the peace process has gone largely downhill since then. The Transitional Federal Parliament's choice for interim president, Colonel Abdillahi Yusuf Ahmed, is divisive and controversial. To many Somalis, his election represents not a step toward peace but continuation of the war by other means. The status of the peace process is grim but not altogether hopeless. Yusuf and his partners need to use their political advantage to form a genuine government of national unity, rather than attempt to impose their own agenda on the transition. The international community needs to make clear that only if this happens will the TFG get the recognition and support it desperately seeks. The probable alternative is resumption of Somali's conflict through all-too-familiar means

The archetypal Somali warlord, Yusuf's opposition to the now defunct Transitional National Government (TNG), his advocacy of a federal structure for Somalia and his close ties with neighbouring Ethiopia, together place him firmly in one camp in Somalia's long-running conflict. In order to cement his victory, Yusuf called for deployment to Somalia of a 20,000-strong multinational military force. His choice for prime minister and the composition of the first TFG cabinet confirmed his pursuit of a narrow political agenda, provoking a parliamentary revolt, a no-confidence vote (ostensibly for other reasons) and dissolution of the government.

The 15 December deadline for the return of the TFG to Somalia, set by the member states of the regional Intergovernmental Authority on Development (IGAD), expired with it still in Nairobi, citing insecurity in its homeland. Divisions between regional powers and the wider international community have impeded the emergence of a common orientation toward the interim Somali leadership.

The challenges ahead are formidable. The TFG must reconstitute itself and return to Somalia; the decision whether to go to Mogadishu or identify an interim seat of government is charged with political significance and may well have repercussions on the security situation in parts of the country as well. Restoration of a secure environment is a top priority: the AU favours a modest monitoring and observer force, rather than the big battalions envisioned by Yusuf; but no deployment is likely until a formal, measurable ceasefire instrument has been drawn up and the deployment of foreign troops has been authorised by the transitional parliament.

The TFG was born impoverished and quickly needs to secure sources of revenue. Few governments are willing -- or able -- to provide direct budgetary support, so the TFG will be obliged to tap domestic sources such as ports and airports. Although most faction leaders have agreed in principle that these should be turned over to the control of the interim government, their commitment is questionable, and no agreement has been reached as to how or when revenues will be shared and managed. If the TFG attempts to gain control of economic infrastructure by force or subterfuge, it risks serious violence.

Over the longer term, the elaboration of a federal structure and the development of a permanent constitution are delicate issues fraught with risk. Despite agreement on a Transitional Federal Charter, many (if not most) Somalis will need to be persuaded of federalism's merits. As yet, there has been little substantive discussion on the form it might take. The demarcation of new administrative boundaries, control of revenue, and the future of existing institutions such as regional "governors" or, where they exist, parliaments, are just some of the issues that are likely to be fiercely contested.

The question of Somali unity is still pending and has been complicated by Yusuf's election. The self-declared Republic of Somaliland associates Yusuf, as the former president of Puntland, with Puntland's claims to the regions of eastern Sanaag and Sool, which lie within the colonial boundaries inherited by Somaliland. Within two weeks of his election, unusually bloody clashes between Somaliland and Puntland forces in the Sool region had left over 100 people dead. Violence has since subsided, and both sides are employing various channels of communication to defuse the tension, but Somaliland's claims to independent statehood have yet to be addressed by the international community and will continue to be a source of friction throughout the transitional period.

Nairobi/Brussels, 21 December 2004