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Zimbabwe Set to Buy Defunct Local Dollar

  • Chris Gande

Zimbabwe dumped the local currency in 2009 following historic hyperinflation and introduced multiple currencies.

Zimbabwe dumped the local currency in 2009 following historic hyperinflation and introduced multiple currencies.

Zimbabweans, who have been holding onto their now defunct local currency, will soon be requested to surrender it in exchange for United States dollars in what the Reserve Bank of Zimbabwe describes as part of a demonetisation exercise to bring finality to the issues of the local currency.

But people are not happy with the rate of exchange in which denominations of between ZW$5 and ZW$500 will be paid at U.S dollar exchange rates of up to US$2. The rate for ZW$5 will be US$0,02, ZW$10 (US$0,08), ZW$20 ($0,08), ZW$50 (US$0,20), ZW$100 ($40c) and ZW$500 at $2.

On commercial websites like Amazon.com and EBay the old currency fetches much more attractive rates.

Notes that were issued after 2008 ranging from ZW$10,000 to $50 billion are not part of the exercise.

Liberal Market Solutions Director, Rejoice Ngwenya, says the government's move is too negative as it comes at a time when the cash-strapped state should have allocated the money elsewhere.

Zimbabwe dumped the local currency in 2009 following historic hyperinflation and introduced multiple currencies.

Economist, Prosper Chitambara, welcomed the move telling Studio 7 that the move saying it is likely to boost investor confidence following incessant rumors that the government is trying to reintroduce the local currency.

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