Half your salary on a pizza? Why Zimbabweans are terrified of these prices

Is the new Zimbabwe dollar bringing back the economic tragedies of 2008 to remind Zimbabweans of some of their worst times?

Source: Half your salary on a pizza? Why Zimbabweans are terrified of these prices – EyeWitness News

A pizza from a popular family restaurant in Harare now costs 252 new Zimbabwe dollars. That’s more than half what some government teachers earn per month. Hang on: haven’t we heard that before?

Rewind 11 years, to Zimbabwe in 2008. Wads of worthless money, perpetual school closures because teachers were on strike — and prices (where goods were still available) in millions and billions of Zimbabwe dollars. Little wonder then that locals are asking: is that horrible time coming back to haunt Zimbabwe?

Last week’s surprise announcement that the Zimbabwe dollar was to make an immediate comeback and the US dollar would no longer be permitted for local purchases, sent prices in some places spiralling — and not just for pizzas.

Firewood? From 35 dollars to 50 dollars a stack (50 dollars would have been worth around R700 last year. Now it’s worth around R88). Hot chocolate powder? Sixteen Zimbabwe dollars to 39. Candles? Oh they’ve disappeared (but there’s been a run on them because of the endless power cuts).

We haven’t reached 2008 levels yet when a tin of baked beans cost 30 billion Zimbabwe dollars. At one point, a loaf of bread was 10 million. Bread there is still around 10 Zimbabwe dollars. But it’s getting harder to find bread.
Those on fixed salaries are suffering.

Raymond Majongwe, the head of the Progressive Teachers Union, tweeted a picture of the menu at St Elmo’s Restaurant in Harare, with its latest prices displayed in Zim dollars. A large Napoletana pizza (at 252 dollars), ordered with a Greek salad ($135) would pretty much cost a teacher his or her entire monthly salary.

Is there ANY hope?

The authorities have hiked interest rates in what they say is a bid to constrain money supply. In 2008, the opposite happened. Back then, the printing presses went into overdrive and bearer cheques, a precursor of today’s bond notes, rolled out in ever-increasing denominations.

This time around the authorities promise they’ll be disciplined. On Monday, Finance Minister Mthuli Ncube assured Parliament’s budget and finance committee that “this is not 2008”. He said that year was marked by fiscal indiscipline. “Now we have fiscal discipline. The policies are far different.”

There is, however, that ominous announcement of 400 million Zimbabwe dollars that are about to be printed. If — and no-one seems to have a clear answer on this — that’s extra cash on top of Zimbabwe’s already-circulating electronic money, that won’t go down well.

In my wallet, I keep a receipt from 2008. It’s for 250 billion dollars’ worth of pet food bought from my local branch of the SPCA. For me, it’s a reminder of the hyperinflation we lived through. And that is something Zimbabweans never want to live through again.

COMMENTS

WORDPRESS: 4
  • comment-avatar
    GoRobin 2 years ago

    Absolutely…! 2008 is just around the corner. By order of ZANU PF.

  • comment-avatar
    Truth 2 years ago

    People need to stop speculating as that is what got us into this mess.
    If we all do a little research we would see that the 400 million is not new money that will be printed but a replacement for existing RTGS liquidity in the system (so there is no printing of new money as its a replacement). Apparently, its good economics to have 10% of hard currency circulating within the economy, currently, we have about 10 billion RTGS in the country and only about 600 million hard currency in circulation. It’s clear that there is a shortfall of 400 million, that is the hard currency that will be released gradually into the system. How do I know this? I just did a little research as I’m no economist!

  • comment-avatar
    Tendai 2 years ago

    Today I bought some US$ for ZW$18 to one US$, and did the transaction by electronic transfer . I desperately need more US $ to pay for a shipment of engine oil

    This price will be a bargain in weekstime

  • comment-avatar
    GoRobin 2 years ago

    Exponential price acceleration…back to the future 2008.