Sunday, August 17, 2008

Zimbabwe to knock 10 zeros off dollar

July 31, 2008

Zimbabwe would issue new banknotes from tomorrow that would knock 10 zeros off the dollar and revalue a Z$10 billion (about R1 on the black market) note to equal Z$1, the central bank governor said yesterday.

"With effect from August 1, all monetary values will be at Z$1 billion," Gideon Gono said at a function attended by President Robert Mugabe.

"We are removing 10 zeros. Ten billion dollars will as from August 1 be revalued to Z$1."

Mugabe warned business people that he would impose a state of emergency if they profiteered. He warned profiteers not to "drive us further".

Gono said as he was addressing acute cash shortages rocking the inflation-battered nation: "With effect from August 1, the Reserve Bank is issuing new currency notes, not bearer cheques, which some have been counterfeiting."

The government will encourage the use of coins, which lost value because of hyperinflation, now running at a record 2.2 million percent.

The Zimbabwean dollar is virtually worthless, with a loaf of bread costing about Z$250 billion and the highest denomination bill worth Z$100 billion.

"We are going to require that prices be denominated in the old and the new currencies," Gono added.

A new Z$100 billion banknote came into circulation in Zimbabwe last week, in a bid to tackle rampant cash shortages, joining about half a dozen new high-denomination notes already issued this year.