Over the last few weeks, U.S.-backed Ethiopian forces, which sliced into Somalia to aid the Western-backed Transitional Federal Government Nov. 19, captured the strategic Islamist stronghold of Baidoa on the Indian Ocean coast and central town of Beledweyne.
Al-Shabaab is under pressure from the north by the 3,000-strong Ethiopian invasion forces, 2,000 Kenyan troops who pushed into Somalia from the south Oct. 16, 2011, and the AU force in and around Mogadishu.
The 12,000-strong AU force, which the U.N. Security Council unanimously agreed to reinforce to around 17,000 in the coming months, is reported to be moving against al-Shabaab groups west and north of the war-scarred capital.
At the same time, the Islamists' key stronghold, the southern port of Kismayu, through which most of its revenues flow, is under threat from Kenyan forces. Its loss would be a major setback for al-Shabaab, so it is expected to put up stiff resistance there.
The Islamists have sought to avoid pitched battles with the foreign armies arrayed against them and relinquished Beledweyne, a commercial center at a strategic crossroads 300 miles north of Mogadishu, Dec, 31 and Baidoa Feb.22 without much of a fight in the face of artillery barrages.
Even though the Islamists' last stronghold in the city has been overrun now, completing an AU drive launched in August, the group is able to carry out terrorist attacks, including suicide bombings, in the capital.
Kenya says Eritrea, Ethiopia's main rival with whom it fought a 1998-2000 border war that still simmers, is arming al-Shabaa, a claim widely supported in the Security Council. Kenyan forces say three aircraft carrying weapons for al-Shabaab landed near Baidoa in November.
Despite its recent string of setbacks, analysts are cautious about writing off al-Shabaab as a fighting force or its potential to switch to international terrorism under the guidance of al-Qaida.
The network's leader, Ayman al-Zawahiri, announced Feb. 9 that al-Shabaab had pledged allegiance to the global movement's leadership.
Al-Shabaab leader Sheik Ahmad Abdi Godane, aka Abu Zubayr, pledged his loyalty to Zawahiri in a 15-minute video and promised to follow "the road of jihad and martyrdom in the footsteps that our martyr Osama bin Laden has drawn for us."
While the alliance may boost the jihadist faction within al-Shabaab, the clan-based movement remains divided between those who want to pursue bin Laden's global holy war against the West and those dedicated to driving foreign forces out of Somalia.
It remains to be seen whether a formal link-up with al-Qaida will strengthen al-Shabaab's capabilities to resist the multinational forces, aided by largely covert U.S. support, aligned against it.
Al-Qaida itself is some disarray after punishing U.S. attacks that have eliminated much the movement's key leaders, including bin Laden, who was assassinated May 2 in a U.S. Navy SEALs raid in Pakistan.
There have been reports that key al-Qaida operatives have been deployed from Pakistan to Somalia and Yemen, across the Gulf of Aden where one of al-Qaida's most aggressive jihadist groups is active and reportedly keen to join forces with al-Shabaab.
"The merger may be the first step in an al-Qaida effort to ensure the survival of the movement by expanding into the larger Islamic world," Washington's Jamestown Foundation think tank said.
But it cautioned that Zawahiri's announcement was "remarkably ill-timed" since it came only days ahead of a Feb. 23 conference on Somalia in London. That gathering pledged greater security and economic support for the embattled TFG.
"The al-Qaida merger will almost inevitably result in greater levels of support than donor nations may have originally intended," Jamestown said.
"The timing of the merger is also unlikely to meet with universal approval from al-Shabaab commanders and will exacerbate existing fissures within the movement's leadership."
TFG Minister of Information Abdikadir Husayn Muhammad suggested the alliance could be a boon for Somalia authorities, too.
"When Ayman al-Zawahiri described the merger … as 'good news,' it was also good news for us," he said. "The time when al-Shabaab used to disguise itself as a Somali Islamic organization has come to an end."