World May. 06, 2008 - 04:31AM JST ( 2 )

MOGADISHU —

Security forces on Monday killed at least five people in the Somali capital Mogadishu as they cracked down on riots sparked by rising food prices and record inflation, witnesses said.

At least 20,000 people were out on the streets to demonstrate as anger grew at printers of fake money and unscrupulous traders whose preference for U.S. dollars over the Somali shilling is helping to push inflation to record levels.

The mobs burnt tires, stoned motorists and smashed shop windows before police moved in to prevent the unrest from spiraling out of control.

Clashes ensued as police became embroiled in running battles with looting protesters and gunfire and grenade explosions echoing out across the war-torn Somali capital.

Two protesters were killed in Waberi, two in Dharkiley and one in K4, all southern areas of Mogadishu where many others lay injured, witnesses said.

Although there are no official inflation figures, U.N. monitors say cereal prices have increased by between 110 and 375% in the past year as central Somalia has endured its worst drought in recent memory.

The dollar is now equivalent to 25,000 Somali shillings, up from an average of 4,000 shillings in 1991 when the country descended into lawlessness after the ouster of dictator Mohamed Siad Barre.

Since then, it has had no central bank to regulate inflation.

“Aren’t we Somalis? Is the U.S. dollar our money? The answer is no,” said one demonstrator, Hussein Mohamed Ali.

Traders blamed the government for the crisis.

“Change must come from the government, not us traders,” said Ali Mohamed Siad, a leading figure among the traders of Mogadishu’s main Bakara market.

“The government collects taxes in dollars… how can we accept a weak shilling?”

A shortage of dollars has led to a bumper crop of fake 1,000-shilling notes—the only available denomination—appearing in market places and fueling the inflation problem in the country.

A vibrant trade in mobile phones, weapons and basic foodstuffs had helped to keep Somalia’s inflation in check over the years.

But last week, the U.N. warned that hyperinflation and a sharp devaluation of the Somali shilling—more than 100% in the last 15 months—have increased food prices, threatening the livelihood of millions of people.

The dire situation has been exacerbated by relentless conflict as well as the delayed start to the April-June rainy season.

Global food prices have nearly doubled in three years, according to the World Bank, sparking riots and protests in several poor countries.

Rising use of biofuels, trade restrictions, increased demand from Asia to serve changing diets, poor harvests and increasing transport costs have all been blamed for the price rise.

The World Food Program is seeking contributions for a $755 million emergency fund, while the U.N. Food and Agriculture Organization is raising $1.7 billion to provide seeds to the poor and boost output.

France said Monday it would double its food aid to Somalia, promising a total of seven million euros in 2008, in a statement after French President Nicolas Sarkozy met his Somali counterpart Abdullahi Yusuf Ahmed.

AFP