Zimbabwe to have own currency by June or July!


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Zimbabwe will have its own currency by June or July because by then market and trading conditions will have stabilised, economist Eddie Cross, who was recently appointed to the Presidential Advisory Council, said.

He told the Zimbabwe Broadcasting Corporation that although prices rocketed in October, November and December and continue to spiral today, by December business had realised that the underlying strength of the economy was sound. Exports were growing and the fundamentals were strong.

He said this was demonstrated by the strength of the bond note which he said was the strongest currency in the Southern African Development Community.

“This indicates the underlying strength of the Zimbabwe economy despite the problems,” Cross said.

Zimbabwe was rocked by anti-government protests last month which resulted in several people being killed and women raped. There was also massive looting and burning of properties.

Junior doctors embarked on a 40-day strike demanding to be paid in United States dollars but the government refused to budge.

Civil servants also threatened to strike demanding a four-fold increase in their basic salaries but once again the government refused to budge but it offered them non-monetary benefits instead.

Some teachers’ unions have, however, asked their members to go on strike from today.

Cross said in his opinion Zimbabwe is going to be in a very different situation by the end of March.

“I think that we are going to be in very different situation by end of March, as quickly as that,” Cross said.

“We will see a return to stable market conditions and stable trading conditions in June or July and this will coincide with the introduction of the new currency by the government.”

Finance Minister Mthuli Ncube said Zimbabwe would have a new currency within months but definitely before the end of the year but he refused to give a timeframe saying this would lead to speculation.

He ruled out the adoption of the United States dollar or the South Africa rand saying this was not currency reform but capitulation.

Asked whether the introduction of the local currency would really materialise, Cross said: “It’s definitely planned and I think it’s sensible because that would end the queues at the banks. It would give people access to their bank balances.”

He added: “It will allow us to issue a currency which can be used for local trading but without the mistakes we made in the past with the Zimbabwe dollar where the governor of the Reserve Bank printed money to cover the fiscal deficit. In economic terms you can’t do that because if you do that then you destroy the value of the currency.”

 

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The Insider

The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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