Always Moving Always Sharing Somaliland

DISRUPTING THE SHADOW CENTRAL BANK
A new reality participating in the de-dollarisation of the local trade of livestock may work in
favour of both authorities (and government workers, paid in shillings) and low-income
households most affected by inflation.
Ministers plan to develop the camel trade as a
unique and local economic development
prospect 1 , which would allow the state to
receive taxes and generate much-needed
income streams to build stable institutions
and functioning infrastructure.
The authorities and especially the central bank are fighting
not only a constant flow of foreign currency, but also a local
shadow central bank, made of tycoons and street-money
exchangers who manipulate prices to their advantage, driving
inflation 2 .
Due to the livestock marketplace’s dependence on streetmoney
exchangers, we consider that a commercialisation of
the current practice of camel trade may result in an even
greater inability to stabilise the local tender against the
dollar.
However, a digital shilling could create a complete bypass to
the money exchanges. By simplifying some of the complex
processes surrounding livestock trade for pastoralists (i.e., by
removing the incredibly large volumes of cash from the
process) the mobile shilling could limit the money exchange
market’s ability to fluctuate local prices.
This impact will depend on pastoralists’ desire to receive
payment in digital shilling. We believe the desire is there,
based on the relatively high adoption (though low usage) of
Zaad via at least one member of a pastoral family (based on
our interviews).
[1] How do you like your camel meat?
http://www.slate.com/articles/news_and_politics/roads/2013/09/
somaliland_s_camel_market_could_camel_meat_be_this_unrecognized_nation_s.html
[2] Somaliland: Central Bank Unable To Control Inflation, Somaliland Sun, Gulaid Abdi Mahir 2014
http://www.somalilandsun.com/index.php/component/content/article/5326-somaliland-central-bank-unable-to-control-inflation
B&MG - SOMALILAND MOBILE MONEY STUDIO D RADIODURANS
MAY 2015
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