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Cash Shortages, Bank Lines Dampen Rising Holiday Spirits in Zimbabwe

  • Jonga Kandemiiri

VOA PITCURE

VOA PITCURE

Eyewitnesses said most banks, especially building societies - savings and loan institutions to U.S. consumers - were unable to meet demand leading some customers to sleep outside banks to keep their place in line

Zimbabwean consumers have again found themselves waiting in long lines to withdraw cash from banks in the cities of Harare, Bulawayo and Mutare amid preparations for what is shaping up as the best Christmas in years following formation of a unity government and stabilization of the economy.

Eyewitnesses said most banks, especially building societies - savings and loan institutions to U.S. consumers - were unable to meet demand leading some customers to sleep outside banks to keep their place in line.

Reserve Bank Governor Gideon Gono blamed the cash crisis on the Treasury, under the control of his arch-rival, Finance Minister Tendai Biti, which he said had under-funded the central bank, leaving it without the capacity to serve as lender of last resort to the nation's financial institutions.

But economist Prosper Chitambara of the Labor and Economic Research Institute of Zimbabwe told VOA Studio 7 reporter Jonga Kandemiiri there was little the Treasury could do because there is simply not enough hard currency in the country to meet expanding financial, business and consumer needs.

Zimbabwe officially abandoned its own debased currency early this year amidst stratospheric levels of inflation and adopted a monetary regimen of mixed hard currencies including principally the U.S. dollar and South African rand.

The shift quickly vanquished hyperinflation but with hard currencies paid out to foreign suppliers of essential goods and reviving economic activity demanding more currency in circulation, cash shortages have become chronic.

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