Al-Shabaab has become al-Qaida’s most lucrative franchise, generating as much as $200 million a year through a system of forced taxation, extortion, and illicit trade that now underwrites a growing insurgency across Somalia, according to a new counterterrorism assessment from the Combating Terrorism Center at West Point.
The report, The Global State of al-Qa‘ida 24 Years After 9/11, describes the group’s financial network as “sophisticated and institutionalized,” rivaling the Somali state in reach and efficiency.
Revenue from road levies, smuggling, and remittance skimming sustains an estimated 18,000 fighters, enabling the militants to retake strategic ground in central and southern Somalia, including Adan Yabaal—a key crossroads northeast of Mogadishu.
Residents and traders say payments, often framed as zakat, or Islamic alms, are demanded at every level of commerce.
Transporters, herders, farmers, and importers pay fees simply to move goods. In many regions, businesses find Al-Shabaab’s parallel system more reliable than federal or regional authorities, even as it funds the group’s campaign of violence.
Flush with cash, the militants have regained momentum after early setbacks during President Hassan Sheikh Mohamud’s 2022 offensive.
Their capture of Adan Yabaal has reopened a vital corridor linking Mogadishu to central regions, turning the town into a staging hub for fighters and supplies.
The setback highlights persistent weaknesses in Somalia’s security forces, which struggle to hold territory despite support from clan militias and African Union troops.
The United States has carried out 71 airstrikes in Somalia this year, targeting training camps and leadership compounds, while the U.S.-Gulf Terrorist Financing Targeting Center froze assets tied to 15 Somali financiers in April.
Somali authorities have also tightened regulations on informal hawala networks and frozen hundreds of accounts linked to suspected tax collectors since 2025.
Yet the CTC warns that shifting Western priorities toward great-power competition has given al-Qaida affiliates in Africa greater room to operate.
For ordinary Somalis, the result is a landscape of overlapping demands—government levies, clan militia fees, and Al-Shabaab’s relentless extortion—that leave traders and families caught between fragile state institutions and militant coercion.
The report concludes that while al-Qaida’s senior leadership has eroded, its African affiliates, particularly Al-Shabaab, now serve as the financial backbone of the global network.
In Somalia, the militants’ ability to tax, collect, and spend at scale has made financing not just a tool of insurgency but the core of their war effort.
