A child carries food aid at a distribution centre in Mogadishu in Somalia in February. A newly released report says that as much as half of the food aid the UN distributes in Somalia ends up in the hands of corrupt contractors, radical Islamic militants and local UN staffers. (Omar Faruk/Reuters)

The United Nations World Food Program said it is conducting an internal review following a report that as much as half of the food aid it distributes in Somalia ends up in the hands of corrupt contractors, radical Islamic militants and local UN staffers.

"The integrity of our organization is paramount, and we will be reviewing and investigating each and every issue raised by this report," WFP executive director Josette Sheeran said in a statement.

"WFP stands ready to offer full co-operation with any independent inquiry into its work in Somalia."

The report, written by a panel of experts monitoring UN sanctions against the East African nation and obtained by CBC News, describes what it calls "large-scale, egregious and systematic obstruction of humanitarian assistance."

It alleges that various parties agree to divert food aid and share the proceeds. According to the report, 30 per cent of aid goes to "implementing partners and local WFP personnel" and 10 per cent to contractors that organize the ground transport of aid.

Another 10 per cent of aid goes to armed groups that control parts of the country, including al-Shabaab, the militant Islamist group linked to al-Qaeda that was recently placed on Canada's terrorist watch list.

The report also said that Somalia's security forces "remain ineffective, disorganized and corrupt — a composite of independent militias loyal to senior government officials and military officers who profit from the business of war."

The agency has since promised not to engage with transport contractors who the report alleges were involved in arms trading.

Sheeran said her organization "would do everything it could to reach the hungry in Somalia." It is estimated that around 3.7 million people in Somalia, or nearly half of the population, need aid.

Canada is WFP's third largest country donor in Somalia, and International Co-operation Minister Bev Oda said it is standing by the UN agency.

"We don't support any terrorist organization, but the World Food Program is the organization that we have a lot of confidence in, in meeting the hunger needs of over a billion people around the world," Oda said.

With files from The Associated Press