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Tuesday 20th March 2018

Somalia to Print Currency for The First Time in Three Decades

Business

7Dnews London - Abdullahi Osman

Mon, 11 Jun 2018 20:29 GMT

The government of Somalia has said it will print new currency notes for the first time in 27 years, to replace those currently in circulation, in order to combat the widespread use of forged notes.

The country’s central bank released the design of the new banknotes and said it will print 5,000 and 10,000 denominations, and needs 41 million US dollars to do so.

Somalia’s economy has been based on the US dollar since the country fell into anarchy in 1991, with the US dollar replacing the Somali shilling. Almost every transaction is done in dollars.

Currently, the 1,000 Somali shilling banknote, which is the only Somali denomination in use in the country, is worth about 4 US cents. Smaller denominations like the 500, 50 and 20 shilling notes stopped circulating either immediately after the war or over the years since.

Warlords and others started to print their own money, flooding the market with fake banknotes following the collapse of the last effective central government in 1991. Today the Somali shilling can be printed anywhere in the world and shipped into the country without any hindrance.

According to the International Monetary Fund, the new notes will help Somalia’s government “combat the existing massive counterfeiting in the country and restore confidence in the national currency.”

“My government is determined to print new versions of the Somali Shilling that include 5,000 and 10,000 denominations,” finance minister Abdirahman Beileh told reporters.

The country’s successive governments have tried to introduce new currencies, but failed due to debt relief conditions imposed by international financial institutions.

Africa