Monetary Developments and Decolonization in Ethiopia (1941-1952)

The article analyses the reorganization process of the monetary setting in Ethiopia which started in 1941 along with decolonization, when the Italian colonial rule came to an end. The country regained independence and the former Ethiopian empire was restored. The monetary reform in Ethiopia after the liberation during World War II, was a necessary measure to be adopted. Different paths however could have been followed at that moment by the Ethiopian government. The crucial choice made in money matter was to re-establish a national monetary unit instead of keeping the country inside the East African shilling area, as it was envisaged in British designs for the post-war setting of the Horn of Africa. The Ethiopian project unpredictably prevailed at the end of a weary negotiation, due to the chiefly American support in the framework of a new role gained by the United States in this area. The Ethiopian Authorities were, as a consequence, enabled to free themselves from dependence on Great Britain.