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The nakfa (ISO 4217 code: ERN) is the currency of Eritrea and was introduced on 8 November 1997 to replace the Ethiopian birr at par. The currency takes its name from the Eritrean town of Nakfa, site of the first major victory of the Eritrean War of Independence. The nakfa is divided into 100 cents.

Eritrean nakfa
One Eritrean Nakfa.png
1 Nakfa Banknote
ISO 4217
CodeERN
Denominations
Subunit
 1/100cent
SymbolNkf (Latin script) ናቕፋ (Ge'ez script) ناكفا (Arabic script)
Banknotes1, 5, 10, 20, 50, 100 nakfa
Coins1, 5, 10, 25, 50 cents, 1 nakfa
Demographics
User(s) Eritrea
Issuance
Central bankBank of Eritrea
Valuation
Inflation9%
 SourceApril 2017[1]
Pegged withU.S. dollar = 15 nakfa

The nakfa is pegged to the US dollar at a fixed rate of USD$1 = ERN15. At earlier times,[when?] it was officially pegged at USD$1 = ERN13.50. The currency is not fully convertible, so black market rates available on the streets typically offered a rate of 32 nakfas per dollar.[2][needs update]

Between 18 November and 31 December 2015, the Bank of Eritrea began replacement of all nakfa banknotes. The banknote replacement initiative was designed to combat counterfeiting, the informal economy but primarily Sudanese human traffickers who had accepted payments in nakfa banknotes in exchange for transporting would-be migrants primarily to Europe. A consequence of this was substantial amounts of the country's currency existed in vast hoardings outside of Eritrea.

The plan to replace the country's currency was top secret and designed to prevent human traffickers bringing their funds back in time to exchange for the new banknotes.[3] On 1 January 2016 the old nakfa banknotes ceased being recognized as legal tender, rendering external stockpiles of currency worthless.[4]

The current series of banknotes is the artwork of an Afro-American banknote designer, Clarence Holbert,[5] and printed by German currency printer Giesecke & Devrient.[6]

Contents

CoinsEdit

Nakfa coins are made entirely of Nickel clad Steel. Each coin has a different reeded edge, instead of consistent reeding for all denominations. The 1 nakfa coin carries the denomination "100 cents". Coin denominations:

  • 1 cent
  • 5 cents
  • 10 cents
  • 25 cents
  • 50 cents
  • 1 nakfa (100 cents)

BanknotesEdit

The nakfa banknotes were designed by Clarence Holbert of the United States Bureau of Engraving and Printing in 1994.

 
The back of the five Nakfa bank note with the actual Ficus sycomorus tree shown above it.

Banknotes come in denominations of:

  • 1 nakfa
  • 5 nakfa
  • 10 nakfa
  • 20 nakfa
  • 50 nakfa
  • 100 nakfa

There have been five series of banknotes since the currency's launch. The first issue for all denominations was dated 24.5.1997; the second issue consists of only the 50- and 100-nakfa notes and is dated 24.5.2004; the third issues also consists of only the 50- and 100-nakfa notes and was dated 24.5.2011, and the fourth issues consisted of only the 10- and 20-nakfa notes and was dated 24.5.2012. (May 24 is Eritrea's Independence Day).[7] The current fifth banknote series which rendered all previous currency valueless is dated 24.5.2015.

1997-present Series
Image Value Dimensions Main Color Description Date of issue Date of first issue Watermark
Obverse Reverse
[1] 1 nakfa 140 x 70 mm Dark brown and black on multicolored underprint Triptych portrait of three children of Eritrea's nine nationalities; flag raising Children in bush school 1997, 2015 May 24, 1997 Camel head
[2] 5 nakfa 140 x 70 mm Dark brown and black on multicolored underprint Triptych portrait of Eritrea's nine nationalities: Young boy, young man, and older man; flag raising Ficus sycomorus 1997, 2015 May 24, 1997 Camel head
[3] 10 nakfa 140 x 70 mm Dark brown and black on multicolored underprint Triptych portrait of three young women of Eritrea's nine nationalities; flag raising Eritrean railway 1997, 2012, 2015 May 24, 1997 Camel head
[4] 20 nakfa 140 x 70 mm Dark brown and black on multicolored underprint Triptych portrait of three young women of Eritrea's nine nationalities; flag raising Three agricultural scenes: farmer plowing with a camel, women harvesting, woman on farm tractor 1997, 2012, 2015 May 24, 1997 Camel head
[5] 50 nakfa 143 x 71 mm Brown-red on pale yellow underprint Triptych portrait of three young women of Eritrea's nine nationalities; flag raising Freighter ships at Massawa port of Eritrea 1997, 2004, 2011, 2015 May 24, 1997 Camel head
[6] 100 nakfa 147 x 72 mm Blue and black on pale yellow underprint Triptych portrait of three young women of Eritrea's nine nationalities; flag raising Farmers plowing with oxen 1997, 2004, 2011 May 24, 1997 Camel head

Exchange rateEdit

Current ERN exchange rates
From Google Finance: AUD CAD CHF EUR GBP HKD JPY USD
From Yahoo! Finance: AUD CAD CHF EUR GBP HKD JPY USD
From XE: AUD CAD CHF EUR GBP HKD JPY USD
From OANDA: AUD CAD CHF EUR GBP HKD JPY USD
From fxtop.com: AUD CAD CHF EUR GBP HKD JPY USD

Eritrea's government has resisted calls to float the nation's currency, preferring the stability of a fixed exchange rate. However periodic devaluations have been made. ERN is a very weak currency. The de facto exchange rate of the currency is around 100 ERN for 1 USD.[citation needed]The currency does not have a good demand outside Eritrea. The black markets that exist in Asmara and a few other towns show the diminishing values of ERN.

See alsoEdit

ReferencesEdit

  1. ^ Inflation rate, average consumer prices, IMF, April 2017, retrieved 9 October 2017
  2. ^ A Broke Nation (PDF) (Oct), Université Cheikh Anta Diop de Dakar, 2004, retrieved 32 October 2016 Check date values in: |accessdate= (help)
  3. ^ Eritrea won’t shorten national service despite migration fears (26 Feb), Sallina News, 2016, retrieved 22 October 2016
  4. ^ Meet the New Eritrea Nakfa Bank Notes (29 Nov), Tesfa News, 2015, retrieved 22 October 2016
  5. ^ Designing Eritrea’s Money was ‘Dream Come True’ (26 Jan), Tesfa News, 2015, retrieved 22 October 2016
  6. ^ Currency and exchange facilities, Eritrea Be, 2015, retrieved 22 October 2016
  7. ^ Linzmayer, Owen (2012). "Eritrea". The Banknote Book. San Francisco, CA: www.BanknoteNews.com.

External linksEdit

Preceded by:
Ethiopian birr
Reason: currency independence
Ratio: at par
Currency of Eritrea
1997 –
Succeeded by:
Current