Financial fragmentation persists despite economic ties: Cross-border payments in the Horn of Africa are often routed through Europe or the Gulf, adding cost and delay, even as trade, ports, and logistics grow.

Each country has unique strengths: Ethiopia as the economic heavyweight, Djibouti as a maritime gateway, Somalia with advanced mobile money, and Eritrea with potential for future integration.

Incremental integration is feasible and necessary: Harmonised standards, interoperable payment systems, and regional clearing mechanisms could lower costs and boost resilience without requiring a common currency or supranational bank.

If you ask a trader in Hargeisa, a coffee exporter in Addis Ababa, a port operator in Djibouti, or a livestock merchant in Mogadishu how money moves across the Horn of Africa States region, you are likely to receive four different answers, and perhaps the same resigned smile. The region has mastered moving people, goods, and ideas across borders for centuries. Money, however, still takes the scenic route.

Despite growing economic interdependence, the region does not have a connected regional banking system. Payments between neighbouring countries are often routed through correspondent banks in Europe or the Gulf, adding cost, delay, and unnecessary complexity or through........

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