Garowe (PP News Desk) — In the latest blow to financial security in the Horn of Africa region just to the east of Taiwan’s diplomatic ally in the region, Somaliland, and in what appears to be a blow to the Puntland Government’s policy to enforce the use of the Somali shilling, businesses in the administrative capital of Puntland have rejected the Somali shilling for transactions.
Two weeks ago a Puntland Government committee tasked with reining in currency depreciation issued instructions on the mandatory use of the Puntland-printed Somali shilling.
The Committee urged citizens to report any businesses that insisted on the sole use of US dollars for transactions.
Disadvantaged people and labourers, who get paid in Somali shilling, use the Somali shilling to buy food and vegetables.
“Early in the morning I tried to buy bread and have a cup of tea at a cafeteria here in Garowe but the barista asked me beforehand if I had dollars to pay with” a young man told the Puntland Post.
“(The) Puntland Government’s unenforceable instructions are merely more ink on a paper” says a retired civil servant in Garowe.
The depreciation of the Somali shilling against the dollar is the main driver of inflation in Puntland.
SIDRA, a Garowe-based think tank, urged the Federal Government of Somalia to help Puntland weather inflationary pressures triggered by unauthorised printing of the Somali shilling in Puntland.
This article first appeared in the © Puntland Post, 2020 and is republished with permission.
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