Zimbabwe president says new currency a must by year-end

Source: Zimbabwe president says new currency a must by year-end – Reuters

Emmerson Mnangagwa, Zimbabwe’s president

HARARE (Reuters) – Zimbabwe must have a new currency by the end of the year, President Emmerson Mnangagwa said on Friday, arguing this would help stabilise prices after inflation hit a 10-year high.

The southern African nation in February removed an unrealistic peg for its electronic dollars and surrogate bond notes and merged them into a transitional currency called the Real Time Gross Settlement (RTGS) dollar.

The unit, which started trading at 2.5 to the dollar on the official interbank market when it was introduced on Feb. 22, was pegged at 5.9 on Friday, bringing its devaluation to 57.6 % to date. The currency has devalued by 49.4 % on the black market during the same time.

Most businesses are now pegging their prices in U.S. dollars and use black market rates to calculate RTGS dollar prices.

“As a country we must have our currency by the end of this year, we have started that journey,” Mnangagwa said at a gathering south of the capital Harare.

Prices of basic goods from sugar to maize meal have spiked in the last month as the RTGS dollar has lost value.

Mnangagwa said price hikes were unjustified.

Finance Minister Mthuli Ncube said in January that Zimbabwe, in the grip of a severe dollar crunch that has caused shortages of fuel and medicines, would have a new currency in the next 12 months.

Zimbabwe abandoned its own currency in 2009 after it was wrecked by hyperinflation and adopted the greenback and other currencies, such as sterling and the South African rand.

As physical dollar supplies started dwindling, the central bank introduced the bond note in 2016 at par to the dollar while the amount of electronic dollars increased, plunging the financial system into disarray.

COMMENTS

WORDPRESS: 7
  • comment-avatar
    Mukanya 5 months ago

    Lets wait and see the dreaming result!

  • comment-avatar

    And then another new currency in 2020, another new one in 2021, and another new on in 2022, etc etc.

    Whatever currency they print is going to be worthless because there is nothing of value in Zimbabwe to back a local currency. There’s no gold. Diamonds have been stolen. There’s not even financial reputation or goodwill to back a new currency.

    There is no choice but to use the US dollar, but as we all know, Zim is a net importer country, and therefore US dollars will always run out.

    The only solution is to FORCE all farms in Zimbabwe to move from being subsistence to being large scale commercial exporters again. That is the ONLY way Zimbabwe is going to become productive again…

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    Falconz 5 months ago

    Yeah… “new currency” isn’t gonna solve anything.  Recovering all the stolen currency (real dollars) will.  Audit the assets (liquid and fixed) of ALL members of the Mugabe regime (including the Generals), confiscate any that was taken by theft, and that will fill the state coffers with billions and solve the problem.  You first, Mr. Mnangagwa.   No..???

    • comment-avatar
      mshayazabhoshe 5 months ago

      very true and if they do that which i doubt they will it will also give confidence to the public that they are serious in fighting graft!

  • comment-avatar
    Mundisa 5 months ago

    we grew up tichingonzi zvichanaka ,I don’t know kuti zvichanaka when .
    Lets wait and see kuti zvichaita when

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    mshayazabhoshe 5 months ago

    introducing a new Zimbabwean currency under such prevailing economic condition Mnangagwa sir is like farting against thunder expecting the sound of fart to be louder than that of thunder!Zimbabwe’s economic situation is a direct result of your legitimacy sir!our economy is as a result of your political shenanigans Mr President.Forget the new currency for now because if you do go ahead being ill advised by that fake finance minister with a a fake doctorate sir we will be heading to pre 2008 where the currency was losing value at an alarming rate more than the speed of sound.soon we will be having gazillionaires because there is nothing backing your currency no gold no diamonds no confidence no production …nothing sir i mean not even your assurance which i am sure the public will never take serious because you are indeed illegitimate leader of Zimbabwe.