Zimbabwe zeroes out currency problems
July 31, 2006
Harare - Zimbabwe's Reserve Bank on Monday slashed three zeroes from its currency to help consumers battling with bundles of money on shopping trips costing them billions and trillions of local dollars.
"From tomorrow, the 1st of August 2006, three zeroes are being
taken off every bearer cheque (bank note) which introduces a new
family of bearer cheques. That makes much more sense and I hope
dollars as well," Gideon Gono, the bank's governor said in a
televised address.
"It returns to us stability and convenience and of course this
is just one monetary mechanism to help make commerce and everyday life more convenient," Gono said about an economy with the world's highest inflation rate outside a war-zone. In June inflation was nearly 1 200 percent.
"I am of the particular opinion that ordinary Zimbabweans must
be commended for their resilience through the challenges they've
had to face with the many zeroes they've had to pronounce."
In a country where a loaf of bread costs a million Zimbabwe
dollars, an average shopping trip can set a consumer back trillions.
Gono gave Zimbabweans 21 days to hand in their existing bearer
cheques for a new series to be issued from Tuesday.
Bearer cheques, essentially money printed on ordinary paper,
were introduced in 2003 as a temporary expedient.
The largest cheque has a face value of 100 000 Zimbabwe dollars,
meaning Zimbabweans have to carry large bundles of cash for even
small purchases.
The country's banks have also not coped with the onslaught and
executives of the country's banks recently told Gono their standard
software, meant to cope with millions and a few billions, was
straining to process deals in 14-digit trillions and even larger
quadrillions, now a regular occurance in Zimbabwe. - AFP
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