In Mogadishu, AU (African Union) peacekeepers and TNG (Transitional National Government) soldiers continue pushing al Shabaab fighters out of the city, block by block. But this effort is endangered by the rampant corruption among TNG officials. Just getting the TNG troops paid requires constant nagging and diplomatic pressure from UN and donor nation officials. Much of the foreign aid just disappears, and TNG officials (especially the ones who stole it) either feign ignorance or come up with absurd excuses. Often, over 90 percent of cash aid is stolen. Arab nations, which have contributed most of the cash, are pressing the UN to do something about this. Already, Arab donors are turning down TNG leaders who come visiting and soliciting aid. It's become common knowledge that very little of the contributed money goes towards helping Somalis (other than those who stole the money).
The UN has told the TNG to shape up or the money will be cut off. There will now be a period of brinksmanship as the TNG officials press the UN to see how serious the threat is. Cutting off financial aid to the TNG would mean a new UN effort to form a government in Somalia. The problem is that nearly all Somalis play by the same rules as the current thieves running the TNG. Some of these guys are religious leaders, some are successful merchants, and others are clan leaders. All see nothing wrong with grabbing any nearby cash, for the good of those close to them. There are few Somalis with a sense of taking care of the greater (all Somalis) good.
This is all drifting towards sending in foreign troops to, in effect, re-impose colonial type rule and attempt to train and install a government that will last. This is a very unsavory option, and not guaranteed to work. No one (at least in Africa or the West) wants to go near the C (for colonial) word. But Chinese military leaders are pointing out that there is no other option, especially if the pirates are to be shut down. The Chinese are willing to contribute to the invasion force, but not to do it by themselves. Some Western military leaders have also pointed out the need for occupation of the coastal towns used as pirate bases. No one, not even the Chinese, want to go much beyond these coastal towns. Note that the Chinese have no hang-ups about the C word, and have long used a more "practical" approach to working with African governments.
For years, some older Somalis, who remembered what life was like (it was much better) before the end of colonialism (1960) and the decade that followed (before things began to come apart), talked about bringing the colonial government back. Many Somalis wish they could hit a reset button, go back to 1960, and try it again. A foreign invasion and occupation is a very distant second best, and would be very messy and very expensive. But many observers, and Somalis, are pointing out that it's reached the point where just about anything is preferable to the current situation. The big hope is for Somalis to do it themselves, but there's been no sign of that so far.
AU nations, concerned about Somalia becoming a refuge for terrorists and criminals of all sorts, is pressuring the UN to impose an air and sea embargo on Somalia. The AU is miffed that this was done to Libya, but not to Somalia. One reason for this is that it was cheaper to impose those measures on Libya, because there were nearby European air and naval bases. It would be much more expensive to do so for Somalia. Moreover, smugglers still operate out of Libya (usually taking illegal emigrants to Europe), and would still be working along the Somali coast. Refugees are a growing problem. Kenya closed its Somali border four years ago, but that has not stopped over 400,000 Somalis from fleeing into Kenya. So far this year, over 40,000 have arrived.
Al Shabaab is getting hammered on the battlefield, in part, because it is increasingly short of cash. Foreign contributions have dried up and increasing use of extortion against local merchants doesn't raise enough. Many aid operations have been either forced to shut down in al Shabaab territory, or have fled because of the increasing demands (for goods and cash) from al Shabaab. The extortion also increases popular anger against al Shabaab, something that has translated into more armed groups fighting the Islamic radicals.
May 24, 2011: Somali officials seized $3.6 million in cash at the Mogadishu airport (later reported as $3.5 million, indicating that someone had taken a cut). The money was flown in from Kenya on one aircraft, and was being transferred to another, apparently for delivery to Somali pirates as ransom. Apparently TNG officials have noted these transfers before, and decided to seize one of the ransoms for being an "illegal cash transaction" or some such. Then again, the cash could be a payoff for any number of illegal activities. The U.S. has made it more difficult to move large sums through the international banking system, thus forcing criminals to resort to these kinds of large cash movements. There's a lot of cash moving through Mogadishu airport, but these transfers are usually protected by bribing the right people. A lot of the cash goes to Kenya, where many pirate gang leaders stash their families, and invest some of their cash.