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Saturday, 20 December 2014
Zimbabwe coins introduced to end change shortage
The Zimbabwe Reserve Bank (RBZ) on Thursday introduced $10 million worth of special bond coins into the market to ease the shortage of small denominations of the United States dollar.
Zimbabwe adopted multi-currencies in 2009 after it was forced to introduce its inflation battered dollar but business has been struggling to deal with a shortage of United States coins.
The government has been struggling to find lasting solutions to the problem of leaving Zimbabwean retailers to devise a variety of solutions to get around the shortage of change but none of them proved satisfactory.
The country's liquidity crisis means shopkeepers and market traders often give change in sweets, airtime for mobile phones and even condoms.
But for small merchants who sell handfuls of tomatoes, onions and lemons to poor people, customers may not always have the luxury of buying a dollar's worth of merchandise.
However, RBZ injected denominations of 1c, 5c, 10c and 25c, while the 50c coin will be introduced in March next year.
Their value would be on par with United States cents and are only for local use.
Similarly, rand coins of 10c, 20c, 50c R1, R2 and R5 worth about R30 million will also be imported to complement the special bond coins.
A total of $20 million worth of bond coins will be imported alongside R20 million worth of rand coins to augment existing stock.
Zimbabwe has exclusively used foreign currency for all transactions since early 2009 after the Zimdollar was rendered worthless by a world record-breaking hyper-inflation.
The US dollar and South African rand are the main currencies used, although about five other currencies are permitted.
The introduction of the special coins has raised fears that government wanted to return the banished Zimbabwe dollar to replace the multicurrency regime.
RBZ boss John Mangudya said the bond coins which were minted outside Zimbabwe would be anchored by a $50 million bond facility from Afreximbank.
"The coins will ease the problem of small change and eliminate the problem of rounding up of prices to a dollar where there is no option to buy more goods and ease the hassle commuters go through trying to break up a dollar to find change," he said.