Zimbabwe opposition calls local 'US dollar' plan 'madness'
10 May 2016, 14:21
Harare – Zimbabwe's opposition condemned the government's plan to
print a local version of the US dollar as "madness" on Monday, as
panic set in over a crippling cash shortage.
"The printing of bond notes will be the death knell to this
economy," the main opposition party, the Movement for Democratic Change
(MDC), said in a statement.
"Zimbabweans have walked this road before. They have not
forgotten the dark days when they were poor quintillionnaires."
Zimbabwe adopted the US and South African currencies in 2009 after
hyperinflation peaked at 231 million percent, rendering the national currency
A recent shortage of foreign notes prompted central bank governor
John Mangudya to unveil measures including limiting withdrawals to $1 000 per
day and printing a series of tokens, called bond notes, rated at par with the
"The MDC is preparing a robust response to this madness and
the party reserves its right to mobilise the people against this ill-advised
decision which is certainly not backed by economic logic," the party said.
Bond notes will complement bond coins, which were introduced in
2014 to tackle a lack of small change.
The notes, which Mangudya said were "at design stage", will
be in denominations of $2, $5, $10 and $20.
They will be backed by a $200m support facility provided by the
Afrexibank (Africa Export-Import Bank).
Mangudya's announcement last week prompted panic, with long queues
of desperate depositors trying to withdraw their money at banks and automated
Economists blame the cash shortage on lack of investment and a
trade deficit which saw the country's import bill standing at $490m in the
first quarter against $167m in exports.