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Zimbabwe Starts Dumping Defunct Currency

  • Gibbs Dube

The process, which will end in September, officially invalidates the old currency that was ravaged by hyperinflation of up to 500 billion percent.

The process, which will end in September, officially invalidates the old currency that was ravaged by hyperinflation of up to 500 billion percent.

Zimbabweans on Monday started selling the now defunct local currency at banks in a $20 million demonetization process.

The process, which will end in September, officially invalidates the old currency that was ravaged by hyperinflation of up to 500 billion percent before the adoption of multiple currencies in 2009.

Central bank governor John Mangudya said he hopes dumping the currently will put to rest speculation of a return of the Zimbabwe dollar as denominations of up to $100 trillion are fetching as much as $35 on online sites like eBay.

Local banker and former president of the Bankers Association of Zimbabwe, John Mushayavanhu, welcomed the move.

Also weighing in, economist prosper Chitambara of the Labour and Economic Development Institute of Zimbabwe, said the move is a little late.

The Reserve Bank of Zimbabwe is buying the old currency for up to $2 for some currencies.

Zimbabwe's hyperinflation was considered by the International Monetary Fund as the worst for any country not at war, and the 100 trillion dollar Zimbabwean dollar note was the single largest known note to be printed by any central bank.

Tourists are known to pay up to $20 for a single note in the resort town of Victoria Falls.

The government has set aside $20 million to mop up Zimbabwean dollar notes and to compensate customers who had local currency bank balances before March 31, 2009.

Bank accounts with balances of up to 175 quadrillion Zimbabwean dollars - that's 175,000,000,000,000,000 - will be paid $5. Those with higher balances will get a rate of $1 to 35 quadrillion Zimbabwean dollars.

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