The RBZ governor is on record for saying that he will resign if bond notes fail. Most people feel he did not fulfil his promise as bond notes, in their opinion has failed. The governor has a different take on things, naturally. He says that no one has brought him concrete evidence that shows that bond notes failed. This is the reason why he has kept his job he argues. He says he will stay in his job until someone brings him evidence to show that bond notes have failed.

Governor Mangudya speaking on bond notes.

The emotional issue of bond notes

A lot of Zimbabweans feel that the Reserve Bank of Zimbabwe deceived them when it introduced bond notes. When they were created, they were meant to solve two issues:

  • The change problem-although the use of the USD has been widespread there has been a shortage of USD change in the form of coins since 2009. As a result, vendors have resorted to clever techniques such as selling multiple items for a dollar. A popular solution involves the use of ZWL notes at prevailing black market rates which are a direct descendant of the bond notes. According to the RBZ governor this proves the “bond notes” are still serving their intended purpose to this day.
  • The second problem was the liquidity crisis. One side effect of the government pilfering people’s USD through RTGS/ZWL printing was that stockpiles of USD started getting lower and lower and suddenly people could not withdraw their money. The bond note was meant to solve this problem by giving local people a currency they could physically get out of the bank and use to make purchases. The bond has failed in this regard. It is still easier to withdraw USD from a bank than it is to get ZWL. This is mostly because the government has decided to be deceptive by giving the impression that they are not printing a lot of money through the printing of very small physical notes and instead minting electronic ZWL in their bucket loads hoping people will not notice this as they did in 2008. As a result the biggest note the $100 ZWL note is barely worth US$0.20

For the longest time bond notes were said to be on par with the USD as they were backed by a mysterious Afleximbank facility that the government secretly pilfered too. They kept printing more and more bond notes which exceeded the said facility too. A lot of people lost their monies and feel they were deceived but as already shown the bond notes were not total failures from the government’s point of view. So the governor can plausibly say he did not fail. His deceit and arrogance however have managed to wreck this country’s faith in the local banks which has led to the current economic crisis.