The Federal Government of Somalia is considering plans to introduce a new national currency as authorities seek to reduce the country’s heavy reliance on the US dollar for everyday transactions, according to a report by Business Insider cited by Mustaqbal.
The report said Somalia is examining lessons from Zimbabwe, which introduced a new currency in April 2024 but has continued to face significant reliance on the US dollar.
Somali Minister of Commerce Jama Mohamed Hassan, cited in the report, said preparations for issuing a new currency are underway, although the government needs to carefully assess the implications before proceeding.
The potential currency reform comes as Somalia faces the challenge of restoring the role of the Somali shilling, which has largely disappeared from everyday commercial transactions in many parts of the country.
According to the report, the Somali government is looking at ways to restore a functioning national currency and reduce dependence on the dollar. However, it warned that the transition would require careful planning and public awareness to avoid economic disruption.
Business Insider reportedly pointed to Zimbabwe as a potential lesson for Somalia. Although Zimbabwe introduced a new currency in 2024, around 60 percent of transactions in the country reportedly continue to rely on the US dollar.
The report recommended that Somalia develop a comprehensive public awareness campaign before introducing a new currency, particularly to help citizens understand how the currency would be used and to reduce the risk of inflationary pressures during the transition.
Somalia’s monetary system has undergone significant changes in recent years. The Somali shilling, which historically served as the country’s principal medium of exchange, has increasingly been replaced by the US dollar and digital payment systems.
By 2026, the Somali shilling had effectively ceased to play a significant role in day-to-day commercial transactions, with mobile money and other electronic payment systems becoming widely used by the public.
The proposed introduction of a new currency would therefore represent a major monetary policy undertaking for Somalia, requiring confidence in the currency, effective regulation, sufficient reserves and measures to maintain price stability.
The government has yet to announce a definitive launch date, design or denomination structure for a new currency. Any such move would also require coordination with Somalia’s central monetary authorities and careful management of the transition from the dollar-dominated system.
Mustaqbal
