The E-Sylum:  Volume 11, Number 19, May 11, 2008, Article 21

COUNTERFEIT-FUELED INFLATION IN SOMALIA SPARKS RIOTING

[Michael Sullivan writes: "This is an amazing news story
on the impact of counterfeiting in Somalia - people die
over counterfeits."  Here are excerpts from the BBC news
Michael forwarded. -Editor]

Somali troops killed at least two people in the capital,
Mogadishu, when they opened fire to halt riots over rising
costs and counterfeit money.

Thousands of people rioted, burning tyres and throwing
stones after traders refused to accept local notes and
demanded US dollars instead.

The recent printing of local shilling notes on illegal
presses has led to spiralling inflation, reporters say.

The demonstrators shouted slogans about the traders such
as "down with those refusing the old money and down with
the dollar-receivers".

Over the last three months, the value of Somali shilling
has fallen dramatically from 17,000 shillings for $1 (50
pence) to 30,000 shillings for $1.

This has been blamed on the printing of vast quantities
of the local currency on illegal presses.

Most people have limited access to US dollar notes,
the only currency shopkeepers will accept.

Our correspondent says both the transitional government
and the leaders of the insurgents have ordered traders
to accept both the old and new local notes.

But businesses argue that most of the old Somali shilling
notes are worn out - they date back to before 1991 - and
worth very little, and they blame the spiralling inflation
on the counterfeit ones.

To read the complete article, see:
Full Story

  Wayne Homren, Editor

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