400 Shillings (Assassination of Yitzhak Rabin) – Somaliland

In 2005, Somaliland’s currency situation was defined by a prolonged and severe depreciation of the Somaliland shilling (SLSH) against the US dollar, which had been eroding public confidence and driving inflation for several years. The primary cause was the unchecked and massive printing of local currency notes by successive governments to cover budget deficits, as the unrecognized state had limited access to international financial institutions or external borrowing. This flood of new shillings into the economy, without corresponding economic growth or foreign exchange reserves, led to a classic devaluation, severely reducing purchasing power and hurting fixed-income earners.

Compounding this was the widespread circulation of counterfeit notes, which further undermined the currency's integrity and complicated everyday transactions. The economy operated on a dual-currency system, with the US dollar functioning as the preferred store of value and medium for large transactions, savings, and imports. This dollarization, while providing stability for those who could access greenbacks, marginalized many who relied solely on the rapidly weakening local shilling, exacerbating poverty and social inequality.

The government, under President Dahir Riyale Kahin, faced intense public pressure to stabilize the currency but had limited policy tools. Efforts focused on encouraging remittances from the large diaspora—a critical source of hard currency—and seeking to control the money supply. However, without formal recognition and the accompanying access to structured financial assistance, these measures provided only temporary relief. Consequently, 2005 stood as a year highlighting the fundamental economic challenges of Somaliland’s unresolved political status, where monetary policy was largely reactive and the population bore the cost of persistent currency instability.