Opinion: Is the launch of Somali Shillings (SOS) – A IMF sponsored Bond-Notes?
“S-O-S, please someone help me
It’s not healthy for me to feel this
Y-O-U are making this hard” – Rihanna on ‘SOS’ released 14. February 2006
This is what it seems like, it doesn’t seem like economic viable effort or worth enterprise, when the International Monetary Fund (IMF) needs to loan and get donor aid valued $41 million United States Dollars, it seems more like quick rich scheme, than anything else. Borrowing funds to print currency never seems like a good idea, especially when the state has itself 300 external stakeholders keeping this in order and fragile alliances all over. You can wonder who will benefit from the Somali Shillings (SoS).
Out of the measure of doing so, 26 million will go to procurement and printing the shillings, the 4 denominations they are put in. This all is done in measure against counterfeit, but nearly none of the loaned or donor-funded money will go to that, only 0.06 million US Dollars. Meaning a measly and insignificant amount money will actually go to stop the counterfeit currency floating around.
That is why I am suspicious, if they are just thinking of printing them, and dropping them in the markets in Mogadishu, how will this benefit the citizens and the Federal Republic itself?
Because it seems like another piece of Bond-Notes, where the funding of the enterprise is bound on foreign currency and foreign bound loans, which makes it an extra debt on the state. As the IMF is co-sponsor and the one behind the enterprise, they are securing as a foreign entity, the national and federal currency. Which happens to be SOS. All of that should send the smoke-signals and the tapping on the floor. Send the signal “SOS”.
Because they state: “This letter provides IMF staff’s assessment on the readiness of the Central Bank of Somalia (CBS) to issue a new national currency under Phase I which will be limited to exchanging the counterfeit Somali shilling notes currently in circulation with new currency” (IMF, 11.05.2018). That is why I question it too, since so little of the funding for the project goes to counterfeit operations, will it be successful? Do they think the magic wand of new paper-money will compensate for the one that is counterfeit right now? How will they go about the exchange from old to new, and will they do that with all currency or will they accept the old-counterfeit to get rid off all fake currency floating around?
Seemingly, it seems like borrowing more money, to print a new line of SOS, which is an SOS to the world. Also, where the IMF needs a huge sum of money, to procure and print them, while the state only get scraps and no direct plan to really eradicate the counterfeits. Because they are only putting up a Counterfeiting Framework, but not initially working against it. Meaning, it is just borrowing and printing new shillings, without any purpose of actually combatting the problem itself. Which is rare thing to do.
Let see how this goes, but I hope this is not a IMF sponsored Bond-Notes project, because that is how it seems like, borrowing funds and donor funding to get new currency floating. Not a good idea, more issues as I see it. That is just me though. Peace