Unlike the pre-civil war period, when most services and the industrial sector were government-run, there has been substantial, albeit unmeasured, private investment in commercial activities.

The investment has been largely financed by the Somali diaspora, and includes trade and marketing, money transfer services, transportation, communications, fishery equipment, airlines, telecommunications, education, health, construction and hotels.

This would rank amongst the lowest in the world if comparable data were available, and when adjusted for the significant inequality that exists in Somalia, its HDI is even lower.

[18] In 2018 the World bank estimated an annual GDP of $6.2 billion, similar in size to Guam and the Kyrgyz Republic,[19] and classifies it as a low-income country.

This would rank amongst the lowest in the world if comparable data were available, and when adjusted for the significant inequality that exists in Somalia, its HDI is even lower.

[24] According to the World Bank, within two years of the outbreak of civil war in 1988, Somali state institutions collapsed and "most of the economic and social infrastructure and assets were destroyed".

The report notes difficulties encouraging and making use of domestic savings for investment, due to the lack of formal financial services and regulatory agencies.

[25] In an article published in 2007, libertarian economist Peter T. Leeson argues that the Somali state was predatory, and that its collapse has improved the economic welfare of its citizens, with 14 out of 18 key development indicators being more positive in the period 2000-2005 than in 1985–1990.

[26] Similarly, economists Benjamin Powell, Ryan Ford and Alex Nowrasteh argue that Somalia's economic performance, relative to other African states, has improved during the period of statelessness.

[17] Ersun Kurtulus states that Leeson and Powell, Ford and Nowrasteh's articles provide "the most unequivocal evidence to indicate that Somalia has been faring far better under anarchy than it did under Barre's regime".

Kurtulus argues that these authors may provide a valid explanation of the situation in Somalia, but that "the argument appears to be derived from a hypothesis which is rooted in a liberal conceptualisation of statehood rather than in a quantitative analysis which establishes a negative correlation between indicators of state predation and those of economic and social welfare".

[9] With the advantage of being located near the Arabian Peninsula, Somali traders have increasingly begun to challenge Australia's traditional dominance over the Persian Gulf Arab livestock and meat market, offering quality animals at very low prices.

[8] Prior to the outbreak of the civil war in 1991, the roughly 53 state-owned small, medium and large manufacturing firms were foundering, with the ensuing conflict destroying many of the remaining industries.

The latter include fish-canning and meat-processing plants in the north, as well as about 25 factories in the Mogadishu area, which manufacture pasta, mineral water, confections, plastic bags, fabric, hides and skins, detergent and soap, aluminum, foam mattresses and pillows, fishing boats, carry out packaging, and stone processing.

[43] As a result of improved security conditions in Mogadishu, the Economist Intelligence Unit reported in 2015 that construction of new infrastructure and repairs to previously abandoned villas was occurring in the city.

[46] However, the Central Intelligence Agency's The World Factbook states that development has not spread to other parts of Somalia, and that security is a major concern for businesses in Mogadishu.

Customers can conduct money transfers and other banking activities via mobile phones, as well as easily gain wireless internet access.

"[49] There are presently around 25 mainlines per 1,000 persons, and the local availability of telephone lines (tele-density) is higher than in neighboring countries; three times greater than in adjacent Ethiopia.

[48] As of 2015, there were also 20 privately owned Somali newspapers, 10 radio and television stations, and numerous internet sites offering information to the public.

The central bank says it will end the inflationary environment when it assumes full control of monetary policy and replaces the presently circulating currency introduced by the private sector.

[53] These remittance firms (hawalas) have become a large industry in Somalia, with an estimated US$1.6 billion annually remitted to the region by Somalis in the diaspora via money transfer companies.

The company provides a broad range of financial services to international organisations, as well as to both large and small businesses and private individuals.

This will serve to expand the national payments system to include formal cheques, which in turn is expected to reinforce the efficacy of the use of monetary policy in domestic macroeconomic management.

The SSE was established to attract investment from both Somali-owned firms and global companies in order to accelerate the ongoing post-conflict reconstruction process in Somalia.

[58][59] Sharia compliant sukuk bonds and halal equities are also envisioned as part of the deal as Somalia's nascent stock market develops.

Initially, seven Somali-owned firms from the financial services, telecommunications and transportation sectors are expected to list their shares therein for prospective global investment.

[64] Somalia concurrently evolved into a major world supplier of uranium, with American, UAE, Italian and Brazilian mineral companies vying for extraction rights.

Abdullahi Hussein, the director of the just-formed Trans-National Industrial Electricity and Gas Company, predicted that the investment strategy would create 100,000 jobs.

The second phase began in mid-to-late 2011 and saw the construction of factories in specially designated economic zones for the fishing, agriculture, livestock and mining industries.