The Bloomberg reports that the Zimbabwe government might be planning to introduce the real Zimbabwean dollar in November when they will actually go on to issue real Zimbabwean dollar notes. Currently, we have had to make do with the few bond notes and coins that were issued during the Multicurrency era which ended in June this year.
Because they were never meant to be the primary currency, there has been a severe shortage of cash in banks with many bank branches having stopped issuing notes a long time ago. All ATMs in the country have not dispensed cash in months and some in years.
Even if the claims are true there are still questions such as whether the government will do what it did back in 2007 and remove zeroes when it does issue the new currency notes?
The Zimbabwean dollar has been in a free-fall ever since it was introduced. Bloomberg even called it the worst currency in the world, pointing out that the currency had lost more than 80% of its value since it was introduced.
Will the new currency be pegged against the Rand? Or will it be backed by gold reserves? It would be wise to tether it to something at least in the short term given the confidence crisis in the country. The RBZ has promised to inject more cash, is this the cash they mean or are they printing bond notes in the interim?
The problem is that the government has now developed a well-entrenched reputation of being unpredicted, rash and inconsiderate. They can introduce a new currency tomorrow, the public be damned.
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