In December last year, when the Ethiopian troops dislodged the forces of the Union of Islamic Courts from the war-torn Mogadishu, political analysts started loudly talking about the possibility of some sort of settlement, but during the last four months such optimism has been swiftly evaporated into a gloominess and despondency.

External and internal stakeholders have been pulling this impecunious country from all sides. There is a long, unending list of such desperate stakeholders who have been frantically wrestling and scuffling with each other to safeguard their own interests there.

Warlords and clan leaders, who hold immense influence over the divided society of Somalia, have pushed their country to this macabre point just because of their personal and economic reasons. Perhaps one of the main hindrance to peace in Somalia is the economic and business interests of the warlords, who have organized big business cartels to win the contracts from the UN and other aid agencies and earn tens of millions of dollars from these dealings.

These business cartels have their own regulations and, instead of paying taxes to the central government, they pay fees to each other for various business transactions. Last year, in a medium-size town run by a warlord, $4 million were generated from the checkpoints.

The web of economic vested interests is so much powerful and well-knit that it has become very difficult for President Abdullahi Yusuf Ahmed and the UN to establish a functioning central government in Somalia. Most of the members of the parliament and even the government ministers are the part of these business cartels that are not ready to relinquish "easy and huge cash" in favour of law and order in the country.

The stability and peace will be anti-dote to the economic interests of these warlords. The interesting fact is that the business groups are supporting both sides of the divide in Somalia. Indubitably, the Union of Islamic Courts, the other major players in Somalia's power game until they were thrashed out of Mogadishu in December, having the support of some powerful businessmen, are openly working for turning Somalia into an Islamic state but they lack popular support for this cause.

In a country that is almost Muslim, identity is stringently based on family and clan. The Somalis have much stronger ethnic and tribal affiliations than religious association. The Islamic militias -- with intentions to forcibly impose Islamic laws -- are facing stiff resistance not only from the secular warlords but also from the general public. Now they have just been cornered to the southern part of the country after their retreat in December.

The third major player in the existing power struggle is Mogadihu's dominant Hawiye clan, which is now trying hard to push the Ethiopian troops to take charge of the capital and thus ensure a big share in the pie. The credit of the on-going sporadic fighting in the strife-torn capital is traced to the Hawiye clan's intent to establish its authority in the major neighbourhoods.

The Hawiye clan, which has generally controlled Mogadishu since 1991, befriended the Islamic Courts against the Ethiopians and the Somali government, which is dominated by the rival Darod clan of Siad Barre.

Abdinur Darman, the leader of Hawiye clan and self-declared president of Somalia, is a shrewd politician who, on the one hand, has motivated his followers to keep up the fight in the streets of Mogadishu, and at the same time, has been working through behind-the-door contacts to generate enough political thrust to create a key position for himself in the future political set-up.

Against this backdrop the existing Transitional Federal Government (TFG), which was created in August 2004, has been struggling to establish its presence in the country. President Abdullahi Yusuf Ahmed has no practical influence and control over the cabinet and ministers, who have been working on their personal agendas.

Despite support from the UN as well as Washington, President Abdullahi has not been able come with any effective formula to drive his country out of this quagmire. The problem with Somalia is that it has equal number of external stakeholders. The biggest among them is the United States, which has been extensively supporting the secular warlords and Ethiopia to counter the Islamic militias for their alleged support for Al-Qaeda.

For a long time, Washington has been consistently projecting that the Islamic Courts in militia are nurturing and harbouring the Al-Qaeda terrorists. Though not officially acknowledged, the Pentagon is reported to have been providing monetary and military support to the secular warlords and Ethiopia, the only US ally in the Horns of Africa right now.

Tough the Ethiopians, who captured Mogadihsu in December along with pro-government troops, are not likely to remain there for a long time because of the increasing instances of fierce clashes but they also would like to keep their influence intact. On the other hand, Eritrea, the alleged supporter of the Union of Islamic Courts, is also indulged in anti-Ethiopia campaign.

There is every possibility that both Ethiopia and Eritrea, still at odds over their 1999 and 2000 border conflict, may resort to a full-fledge proxy war in Somalia. This will mean two simultaneous proxy wars in Somalia -- one being run by the US and the other between Ethiopia and Eritrea -- further hurtling the country into perpetual quagmire.

So, Somalia is being torn from all sides by all stakeholders. Apparently, none of the stakeholders want peace there -- except the United Nations and the African Union, but both lack resources and both are helpless with little clue about a way out.

Dr Imran Khalid is a freelance contributor to The Daily Star.