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This Dec. 8, 2008 file photo shows armed fighters from Somalia's al-Shabab jihadist movement traveling on the back of pickup trucks outside Mogadishu. Training camps in the lawless nation of Somalia are attracting hundreds of foreigners, including Americans, and Somalis recruited by a local insurgent group linked to al-Qaeda, according to local and U.S. officials.FARAH ABDI WERSAMEH/The Associated Press

As Canada deepens its support for African soldiers in their battle against Somalia's militant Islamists, the conflict is rapidly shifting from a traditional land war to a more difficult struggle against an increasingly radicalized terrorist foe.

In its first financial response to the terrorist attack on the Westgate shopping mall in Nairobi, the federal government this week announced $6-million in new spending, with the vast majority of it going to African troops who are waging war against al-Shabab, the Islamist militia that still controls most of southern and central Somalia.

Combined with earlier money, this means Canada has given nearly $21-million to support AMISOM, the coalition of African soldiers and police in Somalia. But analysts warn that a traditional military response is inadequate, especially when AMISOM itself is reported to have struck illicit deals with the terrorists.

Al-Shabab, affiliated with al-Qaeda, has claimed responsibility for the attack on the luxury mall in Nairobi that killed at least 67 people. The group seemed to be in decline after it was forced to withdraw from Mogadishu and the key port city of Kismayu in the past two years, but the Nairobi attack suggested that it is instead adopting new targets and tactics, both inside and outside Somalia.

Al-Shabab's shadowy leader, Ahmed Abdi Godane, has consolidated his control of the militia and shifted it in a more radical and globalized direction, using Islamist ideology to justify anti-Western attacks and to seek closer links with al-Qaeda.

A report in July by a United Nations monitoring group estimated that al-Shabab still has about 5,000 fighters and has preserved the core of its fighting force and resources, while shifting to a new strategy of "asymmetrical warfare" in the cities and countryside.

Despite its territorial losses, al-Shabab has actually increased its revenue from illegal charcoal exports in Kismayu by cutting secret business deals with Kenyan forces within AMISOM and their local militia allies, the UN report said. Al-Shabab's revenue under the new arrangement with AMISOM is likely exceeding the estimated $25-million it was receiving when it had sole control of the port city, the report said.

The UN has banned the charcoal exports, which have decimated Somalia's forests. But the exports have continued to expand, because of corruption in the AMISOM forces and their allies in Kismayu.

Charcoal is just one of many sources of revenue for al-Shabab. It levies unofficial taxes on families in the territories that it controls, it gains revenue from kidnappings and piracy, and it even generates money from illegal trafficking of elephant ivory.

While it was pushed out of Mogadishu and Kismayu, it continued to mount increasingly complex and lethal attacks on targets in Somalia and Kenya, including separate assaults on a fortified UN compound and a courthouse in Mogadishu this year that left dozens dead.

"The explanations from some Western analysts that Shabab is a spent force don't hold up," said Daveed Gartenstein-Ross, a Washington-based counterterrorism scholar and analyst. "They never were decisively defeated in the battlefield. Shabab instead melted away from Kismayu, and as a result it retained capacity."

Little is known about al-Shabab's ruthless leader, Mr. Godane, who has purged his rivals and brought the militia into an alliance with al-Qaeda. Few if any confirmed photos of him seem to exist. He was born and raised in Hargeisa in northwestern Somalia, but he has had little contact with his family for years. One of his brothers, interviewed by The Globe and Mail this year in Hargeisa, said the family hasn't seen the Islamist leader since the 1990s. The United States has issued a $7-million (U.S.) bounty for his capture.

"He's consolidated his control over a sliver of the old Shabab, so we have a leaner, more cohesive, potentially more violent al-Shabab," said Matt Bryden, director of Sahan Research, a Somalia-oriented think tank in Nairobi. "It used to be a fairly broad movement, with shades of extremism within it, including some nationalists and pragmatists. But particularly in the past year, Mr. Godane has eliminated anyone who he feels is not firmly in his camp."

Canada's support for AMISOM includes $5.8-million in contributions in 2011, along with $6-million (Canadian) announced this week by Foreign Minister John Baird, plus a further $10-million announced in 2011 to support a Ugandan police unit within AMISOM.

The Canadian money could be useful in helping AMISOM push al-Shabab out of more territory, potentially reducing its tax revenue. The African military coalition badly needs more resources. With less than 18,000 soldiers, it cannot expand much beyond its current limits, and it lacks large-calibre weapons and helicopters.

But analysts warn that the battle against al-Shabab cannot be a purely military or policing effort. "These are short-term solutions that must go hand-in-hand with a broader response," said Andrew McGregor, a security analyst in Toronto who has written extensively about Somalia. "A functioning economy would go a long way towards reducing support for al-Shabab."

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