Puntland Exchange Rate Crisis Committee Issues Recommendations

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The Exchange Rate Crisis Committee chaired by the former Puntland President Abdirahman Sheikh Mohamud Farole has issued a three-point recommendatios about electronic money transactions below 1 US dollar. Appointed by the Puntland Finance Ministry, the Committee urged mobile money operators to introduce Somali shilling-denominated transactions below 1 US dollar.

The Finance Ministry expects the recommendations to take effect in five days. The light regulation by the Finance Ministry will affect Somtel, Amtel, Golis, Daryeel Bank and Som Bank, key players in Puntland mobile money market. However, the second point of the recommendations contains vague instructions to the mobile money operators in some Puntland State districts that might not be affected by recommendations.

The second point in the recommendations vaguely instructs some Puntland-based telecommunications companies not to change tack.

“It has been agreed that telecommunications companies operating in Puntland State cities bordered with cities, where other competitors are operating, will continue to conduct their dollar-based transactions as usual” reads the second point in the recommendations in translation.

Puntland State Government appointed the Exchange Rate Crisis Committee last year to rein in the depreciation of the Somali shilling against the dollar due party to dual exchange rates and preference for the US dollar over the Puntland-printed Somali shilling for transactions.