In brief
- On 9 August 2023, Mustaqbal Media reported that Somalia's Auditor General raised concerns over revenue transparency in Turkish-managed port and airport operations.
- The Auditor General could not confirm the £32.4 million mutual benefit fee was calculated accurately and said no audited financial reports were shared.
- The companies are alleged to have provided inaccurate income information to reduce the government's share, but no response or later developments were reported.
On 9 August 2023, Mustaqbal Media reported that the Somali government had raised transparency concerns over the management of Mogadishu's Aden Adde Airport and main port by Turkish companies Favori LLC and Albayrak.
The concerns, attributed to a report by Somalia's National Auditor General, focus on revenue verification procedures in what is called the FAA agreement. Mustaqbal Media reported that the Auditor General said the government is entitled to 25% of Favori LLC's income and 62.17% of Albayrak's income under the agreement, but that neither company had shared audited financial reports with the government's accountant general.
The Auditor General stated, "We were not able to confirm that the £32.4 million mutual benefit fee is accurately calculated based on the revenue generated by the two companies and the government's share of that income," according to Mustaqbal Media. The report said the government received $32,442,286.00 in total revenue from the companies in fiscal year 2022, which was lower than anticipated; the relationship between these figures is unclear as Mustaqbal Media did not clarify the currency discrepancy.
Mustaqbal Media also reported that the companies are alleged to have provided inaccurate income information to reduce the government's share of profits after a mandated 90-day timeframe. This allegation is presented as reported by Mustaqbal Media and has not been independently verified. The report does not include any response from Favori LLC or Albayrak, nor does it describe any action taken by the government in response to the Auditor General's concerns.
The spelling of the port operator's name is inconsistent in the report: it appears as both 'Albeyrak' and 'Albayrak'. No developments after 9 August 2023 are addressed in the article, and it remains unknown whether the parties resolved the transparency issues, adjusted revenue reporting, or took any further contractual steps.
Frequently asked questions
Which Turkish companies are involved in the port and airport operations?
Mustaqbal Media reports that Favori LLC manages Aden Adde Airport and Albayrak (or Albeyrak) manages Mogadishu Port.
What specific transparency issues were raised by the Somali government?
The Auditor General said revenue verification procedures in the FAA agreement were not followed, audited financial reports were not shared, and the companies are alleged to have provided inaccurate income information to reduce the government's share of profits.
What are the revenue-sharing terms under the agreement?
According to the Auditor General as reported by Mustaqbal Media, the government is entitled to 25% of Favori LLC's income and 62.17% of Albayrak's income.