How a peace operation is financed is always an important issue. But money matters for the African Union Mission in Somalia (AMISOM) have recently become highly politicized. This is in large part because of the complicated set of arrangements and mechanisms that are required to fund AMISOM. Particularly since mid-2015, some of these arrangements have come under pressure to change owing to a variety of factors, including the longevity of the mission, circumstances in the global economy, and other international crises on the African continent and beyond. The changes have had the predictable knock-on effect of causing political arguments between the African Union, the AMISOM troop-contributing countries (TCCs), and some of the mission’s key partners, most notably the European Union.

This report answers six key questions to explain how AMISOM is financed and how some recent decisions taken by the EU have generated considerable conflict within the mission and among some of its contributing states.

What AMISOM Financing Issues Are Causing Controversy?

Over the past 18 months, the EU has taken several decisions about how it pays AMISOM allowances, placing a cap on the amount it pays towards those allowances, and adopting measures to reduce its financial risks in case the AU does not comply with the EU’s financial standards. These decisions have contributed to at least three types of controversies related to AMISOM.

First, there have been arguments over the appropriate amount of money that should be provided to AMISOM troops as allowances. These arguments intensified when from January 2016, the EU, which pays for all the allowances for AMISOM troops, reduced its payment by 20%, from $1,028 to $822 per soldier, per month.

Second, there have been complaints by several TCCs over delayed payment of allowances to AMISOM peacekeepers in the field, with some claims of troops going without pay for over a year. The most recent delays involve a dispute over the signing of revised addendums to the memorandums of understanding between the AU and each of the TCCs.

Third, the EU’s relationship with Burundi has generated its own unique set of arguments and issues. Specifically, in addition to the previous two issues, in March 2016 the EU Council decided to impose sanctions on the Burundi government related to Article 96 of the bloc’s Cotonou Agreement with the African, Caribbean, and Pacific Group of States. This meant the EU suspended direct financial support to the Burundian administration. Since then, the AU has investigated whether it might be possible to pay Burundian peacekeepers in AMISOM without channeling any monies to the Burundi government. But, so far, no solution has been found.

These three issues have generated a variety of public arguments and threats made by several of the AMISOM contributing countries.

Most recently, in December 2016, Burundian President Pierre Nkurunziza not only said he might withdraw the more than 5,000 Burundian troops in AMISOM but was reported as threatening to sue the AU. On December 8, 2016, his government sent a formal letter to the AU Commission stating that the continued non-payment of allowances to Burundian troops in AMISOM may lead to subsequent decisions by the government, including the possibility of withdrawal. Later, Nkurunziza was reported as saying: “If the Burundian troops in Somalia are not paid until January 2017, they will immediately come back to their home country.” He apparently continued with a threat to sue the AU, concluding: “Burundians have got a gift, that of engaging in legal proceedings and not letting go of the case.” Of course, it is unclear if Nkurunziza would really take legal action, and, if so, who against. Regardless, Burundi’s defense minister, Emmanuel Ntahomvukiye, noted that “11 months of delay in paying troop allowances have demoralized our troops in Somalia.” (This didn’t stop the Burundian contingent launching Operation Antelope that same month to develop and clear some of the key supply routes in AMISOM’s Sector 5).

But Burundi was not alone in voicing criticism related to AMISOM’s finances. In February 2016, for example, President Uhuru Kenyatta threatened to withdraw Kenya’s contingent from AMISOM and criticized the EU’s decision to place a cap on its allowances payments, saying his country was paying with blood and flesh to stabilize Somalia (the Kenyan government does not make public how many of its troops in AMISOM have been killed or wounded). In April 2016, upon the return of Uganda’s Battle Group 15 from AMISOM, chief of the defense forces, General Edward Katumba Wamala, complained about the delay in these troops receiving their allowances. Uganda’s government later threatened to withdraw its troops from AMISOM, but the stated reason for this was frustration with the limited progress being made to develop a Somali army and ineffective military advisers from the United States, United Kingdom, and Turkey.

In a related development, since October 2016, Ethiopia withdrew approximately 2,000 of its troops that had been operating inside Somalia but alongside AMISOM. There were also indications from senior Ethiopian officials that the rest of these additional troops might be withdrawn after the conclusion of Somalia’s ongoing elections process. Ethiopia retained its contingent of some 4,300 troops in AMISOM but blamed the withdrawal of its additional troops on a lack of international support, including from the EU. These withdrawals opened the door for al-Shabaab extremists to return to some of these settlements, often exacting retribution on the local inhabitants for collaborating with the Ethiopian forces. Shortly thereafter, in November, the AU released a press statement calling for a temporary increase “of up to 4,000 troops [for AMISOM] for a maximum period of six months to conduct offensive operations.”

In the same press release, the AMISOM Military Operations and Coordination Committee publicly criticized the EU’s decisions to reduce the rate of allowances payments and to differentiate its payments to Burundi. Specifically, the committee stated it:

“…regrets the decision by the EU to reduce the payment of AMISOM troop allowance by 20%, and urges the UN, EU and the larger international community to urgently find ways of bridging this gap.

Strongly rejects the recent decision by the EU to differentiate its payment procedure to the Burundian National Defence Force (BNDF) contingent in Somalia. Emphasises that the deployment of the BNDF is within the context of an AU deployment and there should be non-discrimination in the payment to all TCCs; Recalls the sacrifices being paid by the forces on the ground and, encourages the EU to urgently consider modalities for reversing this decision, which could have far-reaching negative consequences on AMISOM operations and the overall security gains achieved in Somalia.”

How Has AMISOM Been Financed?

AMISOM’s funding has come from multiple sources including AU member states, the AU Peace Fund, the UN Trust Fund for AMISOM (and, later, the Somali National Army), the UN Trust Fund for Somali Transitional Security Institutions, UN assessed peacekeeping contributions, and a range of AU/AMISOM partners, including the EU.

The various non-AU sources were required to support AMISOM because the AU’s member states have not provided the funds necessary to implement the official system of financing the AU’s peace operations. When the AU adopted the Protocol Relating to the Establishment of the Peace and Security Council of the African Union (July 9 2002), this set out a plan for financing its subsequent peace operations. It stipulated that the AU member states that contributed troops and police would bear the costs of any AU peace support operation during the first three months. The AU would then reimburse these contributing countries within a maximum period of six months and then proceed to finance the operation. Unfortunately, this system has never worked in practice. Moreover, even if it had worked, AMISOM’s long duration and large size would have made it extremely difficult for the AU alone to fund. This was part of the reason for the many attempts by the AU to find alternative sources of sustainable funding for its peace and security activities.

AMISOM’s initial financial costs therefore fell directly on the TCCs: from 2007-11 there were only two of them, Uganda and Burundi. They received considerable financial assistance from several partners—notably the EU, US, and UK—as well as assistance from a private firm, Bancroft Global Development. While bilateral donors provided most training, equipment, and mentoring support for the TCCs, the EU provided the allowances for AMISOM’s uniformed personnel as well as some other forms of support. After 2009, the UN provided the bulk of logistical support to the mission through its Support Office for AMISOM (UNSOA). The two trust funds received donations from a variety of partner states and international organizations, albeit with some caveats. Calculating the overall cost of AMISOM’s activities would therefore involve the sum of bilateral support to the TCCs, AMISOM’s annual budget, additional donor support (through the trust funds) as well as UNSOA’s budget. Between 2009 and 2016, the annual cost of running AMISOM rose from approximately $350 million to $900 million.

How Much Does the EU Pay AMISOM Peacekeepers?

Paying AMISOM’s monthly allowances has become the EU’s single largest development project in Africa. The EU first started providing financial support to AMISOM in 2007. The monies came from the EU’s African Peace Facility (APF), which is part of the European Development Fund. The APF is the EU’s main source of funding to support the efforts of the AU and the African Regional Economic Communities in the area of peace and security. Since 2004, it has disbursed more than €2 billion.

When the EU first supported AMISOM it was understood, as per the AU’s wishes, that the mission would last six months before transitioning into a UN peacekeeping operation. In 2007, AMISOM had an authorized strength of 8,000 troops but only some 1,600 Ugandan troops actually deployed. The level of EU financial support to AMISOM at this stage therefore amounted to approximately €700,000 per month. By 2016, AMISOM had over 22,000 personnel and the cost to the EU was about €20 million per month. Most of this financial support was spent on troop allowances, but it was also used for other issues including death and disability compensation for AMISOM peacekeepers killed or wounded in action and indirect support costs such as supporting some AU personnel working on peace support operations in Addis Ababa and AMISOM offices in Nairobi and Mogadishu as well as with training.

In 2007, the initial rate of allowances paid by the AU to its AMISOM troops was $500 per soldier, per month. In January 2009, this was increased to a rate of $750 per soldier, per month. At this stage, the AU argued that it was unfair that its peacekeepers in AMISOM were receiving lower allowances than their counterparts in UN peacekeeping operations. As a result, from July 2009, the EU agreed to align its payments with the standard UN reimbursement rate, which was then $1,028 per soldier, per month.

In total, between 2007 and September 2016, the EU had committed nearly €1.05 billion to financially support AMISOM under the APF.

How Does the EU Pay AMISOM Allowances?

Not surprisingly, the process of transferring over €1 billion in periodic tranches between two large international organizations involves multiple layers of bureaucracy. Indeed, the whole process of implementing the EU’s financial support to AMISOM can take about seven months and involves a wide range of actors, not all of whom regularly interact with one another.

The process for each support package starts with an informal request by the AU to the EU to assist AMISOM. Exact amounts are then the subject of discussion at funding conferences related to AMISOM, after which the AU issues a formal request for funding for a specified period (now a three-year APF action program). This prompts the EU Delegation to the AU in Addis Ababa to transmit the request on to the EU Commission in Brussels. This can take about a month for a final figure to be agreed. Between 2007 and the end of 2015, the EU had provided 14 AMISOM contracts under the APF.

Next, the EU Commission prepares the appropriate political documents. These require the signature of all 28 EU member states, at which point a formal decision has been made by the EU to commit funds. The EU Commission then prepares the funding contract with the AU, known as Pillar Assessed Government of Delegation Agreements, or PAGODAs. Once compiled, the EU Commission then sends a draft of this agreement to the AU. This internal EU process can take another two months.

Next, at the AU, the legal council reviews the draft. Once reviewed, it is returned to the EU Commission in Brussels for signature. Once signed, the EU Commission then sends it back to the AU for its signature. Gaining these signatures can take an additional month.

Once signed, 70% of the contract value is released to the AU to a bank account in Brussels in Euros. This can take another two weeks. The AU then transfers the money to a bank in Ethiopia, which usually takes another month. Only then can the AU pay the governments of AMISOM’s TCCs, which can take another month. Once 70% of the initial 70% tranche of the contract value has been dispersed, the AU must send the EU a narrative report and accounting details of how the monies have been spent. Once that report is endorsed, the EU releases the next tranche of the contract (usually about 35%). This process is then repeated.

Once the contract is over, an independent financial accounting firm is hired to conduct an external audit. Only after that is complete will the EU disperse the final 5% of the contract amount, or, if problems are identified, the EU asks for some money to be paid back. So far, only a small amount of money has needed to be paid back to the EU from AMISOM accounts. (Some repayments were also required in other AU peace support operations, including AMIS in Sudan, AFISMA in Mali and MISCA in the Central African Republic).

Overall, therefore, implementing the EU’s financial support to AMISOM can take a considerable period of time (approximately seven months) and involves a wide range of often disconnected actors. On the AU side this involves at least the AU Commission’s Peace and Security Department; the directorate of Programming, Budgeting, Finance and Accounting; the directorate of Administration and Human Resources Management; as well as the AU Liaison Office in Brussels. On the EU side, it involves EU/AU commissioners, EU/AU directors, the European External Action Service Africa, the European Commission, the EU delegations in the AMISOM TCCs, and the EU member states. This is a recipe for misunderstanding and delay. Even if everything works smoothly, if the EU wants to start to disperse a contract in October the AU needs to submit its formal request by March at the latest. Responsibility for this on the AU side lies with the directorate of Programming, Budgeting, Finance and Accounting. In practice, however, the AU has sometimes submitted the formal request later than planned, thereby postponing the dispersal of funds. This was the case with the EU’s current AMISOM funding package number 16. For payments to be received by AMISOM peacekeepers on October 1, 2016, the AU formal request should have been received in Brussels by March. Unfortunately, it was only received on October 7, 2016.

How Much Money Goes to AMISOM Troops?

Once the EU monies make their way to the AU, the AU can pass them on to the governments of AMISOM’s contributing countries. The EU now pays a lump sum (comparable to the UN system) and no longer makes a distinction between the so-called “pre-deployment costs” (kept by each government) and the amount to be paid to the soldiers. It is then up to the governments of AMISOM’s TCCs to decide how much money they pass on to their peacekeepers, and when. Hence, it is usually the case that some of the allowances monies go to the defense ministry or other part of the government of AMISOM’s contributing countries as well as to individual AMISOM peacekeepers.

It was for reasons to do with the amount of “pre-deployment costs” that the AU Commission recently decided to review the memorandum of understanding it signed with each AMISOM TCC, after the EU had stopped making reference to any “pre-deployment costs” in mid-2015. In the new memorandums of understanding, AMISOM’s TCCs have taken different approaches to paying their troops. At one end of the spectrum, Kenya now gives the entire allowance to its soldiers in AMISOM (after previously retaining $200 for administrative costs). The governments of Burundi and Uganda decided to retain $200 of the $1,028 monthly allowance. Djibouti’s government now keeps $328, leaving $700 for its troops. Finally, Ethiopia’s government decided to retain over half of the allowances, splitting the retained amount equally between the government and the Army Foundation, a social organization.

Only after these new memorandums of understanding were reviewed and signed could the AU deliver the EU monies to the contributing countries (for the period  January 1–September 30, 2016, for Djibouti, Ethiopia, Kenya, and Uganda, and for the period January 1-March 14, 2016, for Burundi, because of the EU’s Article 96 sanctions decision). Part of the delay is the lack of signatures from all the AMISOM TCCs.

Why Did the EU Reduce AMISOM Allowances by 20% from January 2016?

To understand the EU’s decision it is necessary to start with a policy change that took place in the UN. Effective July 1, 2014, the UN raised its monthly reimbursement rates for its peacekeepers from $1,028 to $1,322 per soldier. That rate was also set to increase gradually to $1,410 per peacekeeper by July 1, 2017. This raised the question of whether the AU would also align its rate of AMISOM allowances with the new UN rate given that had been the rationale behind adopting the $1,028 figure.

In mid-2015, the Ugandan government raised this issue, saying that since the UN monthly peacekeeping rates had increased and would rise even further subsequently, the EU should align its payments with the new UN peacekeeping rates. Unsurprisingly, the prospect of increasing the AMISOM allowances payments by approximately 30-40% (up to approximately €32 million per month) triggered another round of debate within the EU. The EU member states decided against making this new alignment and instead set a cap of €738/$822 per peacekeeper, per month starting on January 1, 2016. Notably, the EU did not reduce the overall level of financial support it provided to AMISOM through the APF. Rather, the monies that were saved by reducing the allowances payments by 20% were reallocated to provide AMISOM with support in other areas, including renting houses for AMISOM in Nairobi; some running costs for the AU headquarters; and supporting AMISOM’s training of the Somali National Army in Somalia. The rationale behind the EU’s decision was twofold. First, that a reduction in allowances was necessary to ensure the longer-term sustainability of the APF. And, second, that this reallocation was in line with AMISOM’s stated exit strategy and the need to provide more support to developing Somalia’s national security forces.

The EU position remains that the AU can decide to pay AMISOM soldiers whatever rate it chooses, but the EU would, from January 2016, pay no more than €738/$822 per peacekeeper per month. The EU hoped that the AU could find another partner to fill the subsequent gap in payments. So far, a way of closing the funding gap has not been found.

Conclusions

The EU has been a crucial and longstanding partner for AMISOM and the AU, providing financial support for allowances and other areas and, since 2010, a training mission. In addition, the EU’s member states also contribute financially to AMISOM through their share of the assessed UN peacekeeping contributions used to fund UNSOA/UNSOS. Some individual EU members, notably France, Italy, and the UK, also provide additional financial support in cash, in kind, or for training. It is therefore unfair to conclude that the EU has not provided its fair share of support for AMISOM. Nevertheless, the current arguments about paying for AMISOM raise several questions that should be reflected upon by all the mission’s stakeholders.

First, to what extent, if any, might the current AMISOM funding crisis alter the strategic partnership between the AU and EU?

Second, while the EU has articulated valid reasons for reducing its payments of AMISOM allowances, how can other AU partners close the funding gap at a critical time in the process of stabilizing Somalia? This is especially important given that the AU’s efforts to generate financial support for AMISOM from other partners, including China, Turkey, India, Russia, and the Gulf states, has failed to produce significant results.

Third, with regard to the EU-Burundi relationship, it seems highly unlikely that paying Burundian troops in AMISOM while bypassing the government is a way to meet the demands placed on EU financial aid by the Article 96 sanctions. The scenario of zero EU funds reaching AMISOM’s Burundian contingent should therefore be dealt with as a priority.

Finally, what would a sustainable set of financial arrangements for AMISOM entail? While the recent AU initiatives aimed at financing its own peace and security initiatives by 2020 are a positive step forward, they will not come soon enough to solve the current crisis concerning AMISOM. An alternative approach is needed and will almost certainly involve the UN.

Paul D. Williams is Associate Professor of International Affairs at George Washington University. _at_PDWilliamsGWU.