Pharo Construction Limited: A Critical Catalyst In Somaliland’s Development

In 2021, Pharo Ventures Somaliland set out to help rebuild Somaliland through job creation, adding economic value and developing skills. The first Somaliland Venture, Pharo Construction Limited (PCL), seeks commercial profitability whilst serving the overall purpose of economic development in multiple ways. This article details five channels through which PCL boosts development: job creation, infrastructure, technology transfer, skills development, and sustainability, both environmental and social. We conclude with some of the highlights of PCL’s work to date.

According to the World Bank, the construction sector in Sub-Saharan Africa accounts for approximately 8% of the region’s GDP and employs millions of workers. Construction companies provide direct employment opportunities to skilled engineers, architects, and manual laborer, reducing unemployment rates and creating income-generating opportunities for families. Furthermore, the construction sector stimulates job growth in related sectors such as suppliers of construction materials, transportation, and various services, creating hundreds of indirect employment opportunities and contributing to local economic development. PCL exemplifies this: it has created 35 direct jobs and thousands of indirect jobs in the past two years. PCL has also had outstanding job retention with 86.5% of people hired in permanent roles remaining in post today. In doing this, it has mixed local workers and highly skilled international talent, from whom locals are benefitting.

Infrastructure development is another area where Pharo Construction makes an important contribution. A report by the United Nations Economic Commission for Africa highlights the significant infrastructure gap in Africa, constraining economic growth and development. Building infrastructure will ultimately contribute to attracting investments, boosting productivity and driving economic empowerment in Africa. PCL has already contributed to bridging the infrastructure gap by building essential assets such as the Ijaara dam, which embodies the joint values of Pharo Ventures and the Pharo Foundation. It seeks to continue building such assets going forward.

PCL also contributes to technology transfer and skills development. By bringing advanced construction techniques, technologies, and expertise to the Horn of Africa, PCL enhances local capabilities and develops a skilled workforce. PCL’s use of the battered excavation technique for the construction of the Ijaara dam created a demonstration effect for other Somaliland construction companies. In turn, as local workers acquire new skills, they become more employable in construction and other industries, driving overall economic empowerment and diversification.

Whenever possible, PCL also incorporates a sustainability dimension into its projects. In line with the UN Sustainable Development Goals, Pharo Construction already recycles all the wood it uses. This means it saves money, takes less waste to landfill and conserves resources. Remaining unused wood which is left over after projects is donated to a charity chosen by Pharo Foundation.

Furthermore, PCL makes suggestions for the construction of homes that both meet their clients’ needs and are as sustainable as possible. Such suggestions include:

1. Suggesting the inclusion of more green areas for vegetation (for one customer it added an automated irrigation system).
2. Ensuring the maximization of natural light (four recent projects adopted rooflight windows with breath-taking views of the skyline above – this helped owners reduce energy costs and added value to their homes).
3. Facilitating car charging facilities (in one of the homes which PCL built, it installed smart sockets, allowing home automation and a reduction in energy costs).

Finally, PCL’s construction projects typically involve community engagement and social development initiatives. PCL has worked closely with local communities to understand their needs and concerns, it employs local labor, and supports local businesses. In April 2022, a fire ravaged the Waheen Market, a significant source of livelihood for the residents of Hargeisa in the capital of Somaliland, destroying property worth up to $2 billion and wounding at least 28 people. 12,000 jobs were lost, and about 5,000 small, medium, and large-sized business owners lost their establishments. Given the importance of this market, PCL is proud to be supplying much of the concrete needed for its re-construction.

After two years in operation, some of the highlights of PCL include:

• Building residential housing, including six bungalow projects and a residential two-story home.
• The extension & modernization of girls’ dormitory for Sheikh’s renowned boarding school as well as the construction two early childhood education centers.
• Constructing Ijaara dam – a 62,000 cubic meter dam now very near completion. This provides drinking water for both the people in the local community and for livestock.
• Constructing 29 Commercial shops for Egal International Airport.
• PCL is the first construction firm in Somaliland that employs a health, safety and environmental officer and just the second company that has established a ready-mix concrete (RMC) batching plant in Somaliland. In doing this it has already produced 4,200 cubic meters of concrete and this is being used in projects such as the reconstruction of Waheen Market. The construction industry in Somaliland is benefiting from the establishment of RMC in three ways:

1. Construction firms/projects have greater access to tested and certified concrete.
2. There is improved efficiency of construction projects.
3. The price of concrete has fallen partly due to RMC breaking up a monopolistic market.

Overall, we are proud of the work PCL has completed these last two years both from a developmental standpoint, but also from a commercial perspective in becoming established and trustworthy businesses able to compete in both price and quality. We hope the projects completed to date are just a taste of what’s to come and that we see yet more job creation, technology transfer and skills development in the coming years. Continuing to work hard and sticking to our values, we hope we can play our part in Somaliland’s economic growth and improving the region’s infrastructure.

Source: Pharo Foundation