Puntland to Introduce Own Currency, Deepening Rift with Somalia's Government
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Staff Reporter GAROWE ONLINE
- Posted On 21-12-2024, 02:54PM
GAROWE, Somalia - The leadership of Puntland announced plans to unveil a new currency in the latest move which further showcases the deep rift between the central government and the Federal States over Somalia’s internal affairs, including the electoral process and the constitution.
Somalia faces divisions as Somaliland claims to be an independent state and has still fighting for international recognition for over three decades.
Puntland President Said Abdullahi Deni said his government would introduce its currency in 2025, a decision which technically means the Somali Shilling will no longer be of use to the region once the decision is fully implemented, despite being discarded three years ago.
The decision to use its own currency is said to be anchored on strategies to improve the economy, President Said Abdullahi Deni said. Puntland has largely been using the US dollar since 2021 after stopping the Somali shillings after inflation. The Somali Shillings are used in some markets in the southern regions.
According to Deni, the new currency would align with Somalia’s financial system in the future as Puntland moves towards greater economic independence. He accused the federal government of Somalia of failing to print new banknotes to replace the old currency.
“The Puntland government has initiated a study on creating its currency, similar to practices in some federal countries. This currency will be compatible with Somalia’s financial system in the future when the mindset and circumstances improve,” he said.
However traders in Puntland embraced the US dollar in the past, further showing a lack of confidence in the old Somali Shillings. The Federal State had cut ties with the government of President Hassan Sheikh Mohamud.
Also, this move comes as the country heavily depends on the use of the US dollar and electronic money provided by private Telecom firms and banks. Deni also emphasized his plans to revive the economy of the region.
GAROWE ONLINE
