Friday October 6, 2023
MOGADISHU (HOL) - The Sahamiye Foundation has issued a pressing appeal to De La Rue, urging the company to reevaluate its contract with the Central Bank of Somaliland for printing 380 billion SL shillings. The foundation warns of economic, ethical, and legal repercussions that could exacerbate poverty and inequality in the region.
The injection of a substantial volume of local currency into Somaliland’s predominantly dollarized economy is a central concern. The foundation fears this influx could particularly affect vulnerable and low-income populations. The anticipated devaluation of the SL shilling, from 8,750 to over 20,000 per dollar, amplifies these apprehensions.
The SL shilling has suffered significant devaluation since the mid-1990s, attributed to excessive printing. This devaluation has disproportionately impacted the impoverished, while benefiting corporations like De La Rue. The mandatory conversion of transactions under $100 to the local currency has stripped the poor of their ability to protect their assets against continuous devaluation.
The Sahamiye Foundation questions the logic behind printing an additional 380 billion SL shillings, given the prevalent use of mobile money and the largely cashless nature of Somaliland’s economy. Suspicions of corruption and profit motives cloud the contract's intent, raising ethical questions.
The awarding of the contract to De La Rue, bypassing standard procurement protocols, competitive bidding, and parliamentary approval, has raised transparency and legality issues. These concerns are magnified by De La Rue’s past involvement in corruption scandals and investigations.
As Somaliland reels from the impacts of local and global crises, including the Hargeisa market fire, the Covid pandemic and the ongoing Ukraine war, the proposed currency printing threatens to push millions into deeper poverty. The Sahamiye Foundation’s plea is a call for ethical business conduct and the safeguarding of Somaliland’s economic stability. The foundation urges De La Rue to cancel the contract and return the $9.6 million earmarked for printing, portraying a commitment to ethical business and the welfare of Somaliland’s populace.