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Somali Central
.bank to overhaul currency, counter
fakes
March-29-08
NAIROBI, March 29 (Reuters) - Somalia's
embattled central bank plans to revamp
the anarchic country's currency because
of a flood of fake notes printed by
warlords and businessmen.
Addressing donors meeting in
neighbouring Kenya on Saturday, the
bank's director general, Sharif Mohamed
Hassan, said "greedy" individuals had
pumped counterfeit cash into the market
for years, driving the local unit to its
lowest ever level.
In 1990, Hassan said, the Somali
shilling was worth around 930 to the
dollar. But by 2001 it had fallen to
14,000, and now it has slumped to around
25,000 shillings per greenback.
"The present situation of counterfeit
money is catastrophic," he said. "It's a
priority to provide the market with a
stock of new bank notes with good
security features."
The interim government, which has
struggled to impose its authority on the
Horn of Africa nation, must take drastic
action against people importing and
printing fake notes, he said.
"Of course this is not easy, as the fake
notes are printed in many areas that are
not properly controlled," he added.
The high volume of counterfeit bills is
causing inflation and driving up food
prices, he said, which aid workers warn
is worsening one of the world's worst
humanitarian disasters.
More than 1 million Somalis are now
internal refugees, and some 20,000 flee
the capital Mogadishu every month to
escape fighting between government
forces and Islamist insurgents.
Many displaced end up in areas suffering
acute drought.
"How can we talk of poverty reduction
when prices have almost doubled in less
than two years, in a country with one of
the highest rates of unemployment on
Earth?" Hassan asked.
"It's heartbreaking and frustrating."
He said Somalia's new bank notes would
be produced by a "world renowned" money
printer, but did not give a timetable.
The central bank would decide at what
rate they will be exchanged for the old
bills, he told the meeting, which was
organised by the United Nations and the
World Bank.
"Highest consideration will be given to
minimising the loss to members of the
public who have been victims of the
greedy businessmen who introduced the
counterfeit money," he said. (For full
Reuters Africa coverage and to have your
say on the top issues, visit:
africa.reuters.com/)
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