Currency, Exchange Rate, and Inflation
The official currency is the Eritrean nakfa (ERN), introduced in November 1997. In early 2005, likely in an effort to increase foreign capital reserves, the Eritrean government decreed that all transactions in Eritrea must be conducted in nakfa. In April it became illegal for individuals to hold and exchange foreign currency. As of January 1, 2005, the government set the foreign exchange rate at US$1=ERN15.
Inflation continues to be a problem in Eritrea, particularly as years of drought push grain prices higher and defense expenditures remain high. The International Monetary Fund estimates that in 2003 (the most recent year for which figures are available) average inflation reached 23 percent.
Read more about this topic: Economy Of Eritrea
Famous quotes containing the word exchange:
“We never exchange more than three words with a Friend in our lives on that level to which our thoughts and feelings almost habitually rise.”
—Henry David Thoreau (1817–1862)