NEW YORK: (DNA) – Al-Shabab militants in Somalia are funding their extremism with $7.5 million a year from smuggling through transit points in Iran, according to a new UN report.

The group, which is affiliated with Al-Qaeda, illegally exports charcoal to Iranian ports using fake country of origin certificates from Comoros, Ivory Coast and Ghana.

The charcoal is packaged into white bags labeled “Product of Iran,” loaded on to Iranian-flagged dhows and re-exported to Dubai in the UAE. “The charcoal trade continues to be a significant source of revenue for Al-Shabab, generating at least $7.5 million from checkpoint taxation,” according to the report by UN sanctions monitors submitted to the Security Council.

The report estimated the wholesale value of illicit Somali charcoal to be $150 million a year in the UAE, where it is widely used for cooking and smoking shisha.

Lana Nusseibeh, the UAE’s new ambassador to the UN, said the country was not complicit in the smuggling trade.
“The UAE is fully aware of all Security Council resolutions and is in full compliance with the sanctions imposed,” she said. “We also reaffirm our continued cooperation with the monitoring group throughout its mandate.”

The monitors track compliance with UN sanctions on Somalia and Eritrea. The Security Council banned charcoal exports from Somalia in 2012 in an effort to cut off funds for Al-Shabab, who are trying to topple Somalia’s Western-backed central government and impose its own extremist rule.

The council also imposed an arms embargo on Somalia in 1992 to cut the flow of arms to feuding warlords, who ousted dictator Mohamed Siad Barre and plunged the country into war.
In addition to earnings from charcoal, Al-Shabab is making millions of dollars a year from tolls on vehicles in areas where they run checkpoints, and through taxes on businesses, agriculture and livestock.

“Employing mafia-style tactics, the group is able to levy taxation via a network of hinterland checkpoints, with collection of taxes enforced through violence and intimidation,” the UN report said. Truck drivers risked execution if they tried to avoid the checkpoints.

All this “generates more than enough revenue to sustain its insurgency.” One checkpoint, 160km northwest of the capital, Mogadishu, earns the group about $30,000 a day — $10 million a year.