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Small Change a Big Problem for Zimbabwe Economy Now Based on Hard Currencies

  • Gibbs Dube

Economists said imports of foreign notes and coins including U.S. and South African rand will be inhibited by transport costs and Western sanctions

Zimbabwean Finance Minister Tendai Biti says Zimbabwe will start importing foreign banknotes in small denominations as well as coins to relieve acute shortages of change that have been hindering economic transactions.

Biti said the shortage of small-denomination banknotes poses a challenge to retailers.

But economists said the importation of notes and coins in foreign currencies including the U.S. dollar and South African rand will be inhibited by high transport costs and Western sanctions on ZANU-PF officials.

Economic commentator Bekithemba Mhlanga told VOA Studio 7 reporter Gibbs Dube the country needs to adopt the rand as its principal currency to hold down large importation costs of notes and coins. “Zimbabwe will fail to import all these required small denominations if it does not adopt the rand,” Mhlanga said.

Bulawayo economist Eric Bloch said importing U.S. notes and coins will be impeded by Western sanctions targeting President Robert Mugabe and about 200 other top ZANU-PF officials and supporters.