{Zimbabwe has launched its own money for the first time since the country’s dollar was abandoned seven years ago amid rampant inflation.}<\/p>\n
The bond note, which is worth one US dollar – the country’s main currency since 2009 – is raising fears of a return to the ill-fated local dollar.<\/p>\n
The move, first announced in May, has fuelled some of the biggest protests in a decade against President Mugabe.<\/p>\n
The government has issued the bond note to tackle a worsening cash shortage.<\/p>\n
It hopes the cash substitute, which is legal tender in Zimbabwe but is not valid outside the country, will halt the flow of US dollars going overseas.<\/p>\n
Initially, an amount worth $10m is being introduced into circulation in two and five dollar denominations.<\/p>\n
Why Zimbabweans are spending the night outside banks<\/p>\n
Business groups have welcomed the move as a way of boosting economic growth.
\nHowever, major opposition parties, workers and civil society groups are planning further protests this week.<\/p>\n
And in the run-up to the notes’ release, Zimbabweans queued for hours to withdraw their US dollars amid fears the bond notes would not be able to keep parity.<\/p>\n
The Reserve Bank of Zimbabwe has always steered clear of referring to the new bond notes as currency.<\/p>\n
For ordinary Zimbabweans, memories of the collapse and demise of the Zimbabwean dollar in 2009, and the hyperinflation that caused its destruction, still rankle.<\/p>\n
So, it’s a question of “when is a currency not a currency?”<\/p>\n
Withdraw from a bank today in Zimbabwe and you’ll be issued with bond notes, which are officially interchangeable with the US dollar at a rate of one to one.<\/p>\n
You can take the notes to the shops and exchange them for goods. All very well and good, you’d think.<\/p>\n
But what a currency needs is confidence, and on the streets of Harare there seems to be precious little of that.<\/p>\n
There were few alternatives for the Reserve Bank – the economy is experiencing a chronic shortage of US dollars, which have been the main currency of use for the past seven years.<\/p>\n
But such is the fear that the bond notes will be unable to hold their parity with the dollar that their introduction has sparked the largest anti-government protests in years.<\/p>\n
If the current experiment with bond notes even looks like taking a step backward to the hyperinflation of seven years ago, not only will the economy’s very survival be in jeopardy, so too will the government’s.<\/p>\n
Zimbabwe’s central bank has assured people the notes’ release will be controlled, including weekly withdrawal limits of $150 worth.<\/p>\n
Under a proposed law, anyone found guilty of defacing the notes could face up to seven years in prison.<\/p>\n
They will become one of nine currencies accepted as legal tender in the country.<\/p>\n
Zimbabwe’s 2008-9 hyperinflation crisis in numbers<\/p>\n
An egg cost 50 billion Zimbabwean dollars in 2008<\/p>\n
A loaf of bread cost the same as 12 brand new cars would have cost ten years previously<\/p>\n
Inflation rates reached 231,000,000%<\/p>\n
To keep up with the rising prices, a 100 trillion dollar note was issued – enough for a weekly bus ticket – before the Zimbabwean dollar was scrapped in 2009<\/p>\n","protected":false},"excerpt":{"rendered":"
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