The East African shilling was the currency issued for use in British controlled areas in East Africa from until It is also the proposed name for a common currency that the East African Community plans to introduce.
The shilling was subdivided into centsand a pound was equivalent to twenty shillings. In the United Kingdom, the pound sterling formerly was divided into twenty shillings, and it was normal to consider the shilling to be a subsidiary unit of the pound. In British East Africahowever, even though twenty shillings were equal in value to one pound sterling, the shilling was always considered the primary unit of account.
This state of affairs was unique amongst all the parts of the British Empire that used the pound sterling currency. This anomalous state of affairs arose because the first currency used by the British colonial authorities in British East Africa was the rupeenot sterling.
The East African shilling was introduced to KenyaTanganyikaand Uganda inreplacing the short-lived East African florin at a rate of 2 shillings to 1 florin. The short-lived florin had been introduced of increasing silver prices after World War I. At that time, the Indian rupee was the currency of the British East African states.
The rupee, being a silver coin, rose in value against sterling. When it reached the value of two shillings, the authorities decided to replace it with the florin. From the florin thence came the East African shilling.
The currency remained pegged to one shilling sterling and was subdivided into cents. Inthe East African shilling replaced the Indian rupee in the Aden colony and protectorate, which became the South Arabian Federation in Inthe East African Currency Board was breaking up, and the South Arabian dinar replaced the shilling in the South Arabian Federation at a rate of 20 shillings to 1 dinar.
The shilling was also used in parts of what is now SomaliaEthiopiaand Eritrea when they were under British control.
Inas a result of World War IIBritain regained control and introduced the shilling, at a rate of 1 shilling to 24 lira. Italian Somaliland was returned to Italy in as a UN Trusteeship and soon switched to the Italian Somaliland somalowhich was at par with the shilling. British Somaliland gained independence inand joined what had been Italian Somaliland to create Somalia.
In that year, Somalia began using the Somali shilling replacing the Somali somalo at par with the East African shilling. Ethiopia regained independence inwith British support, and began using the East African shilling. Maria Theresa thalersIndian rupees, and Egyptian pounds were also legal tender at the beginning of this and it is unclear exactly when this status ended. The lira was demonetized in When Eritrea formed a federation with Ethiopia inthe birr, which was already in use in Ethiopia, was adopted in Eritrea.