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Zimbabwe Central Bank Chief Projects Medium-Term Drop In Inflation From Over 6,000%

Reserve Bank of Zimbabwe Governor Gideon Gono said Monday that a new currency would soon be issued as part of a plan for medium-term reduction of inflation that ran at an official 6,593% in August though economists offered far higher estimates.

Gono said he had never imagined that the "angry and formidable" inflation rate would reach such levels, but said he was not deterred and would reverse the trend.

The central bank chief announced that Zimbabwe had secured a $200 million credit line to finance the import of fuel, for many months in acutely scarce supply.

Announcing the near-term issuance of a new currency, he warned "cash and money barons” who were creating “mini-central banks” to unload their cash holdings.

He said he was concerned about the impact of the so-called economic empowerment bill passed recently by parliament, which provides for the government to acquire a 51% stake of all foreign-owned firms, saying it could be “counterproductive.”

Gono appealed to Zimbabweans in all sectors of society to help rebuild the economy. He also thanked the executive secretary of the Southern African Development Community for a summary report on the country's economic situation.

Economist David Mupamhadzi agreed with Gono's contention that all stakeholders needed to chip in to bail out the economy - but told reporter Ndimyake Mwakalyelye of VOA's Studio 7 for Zimbabwe much more reform was needed for a turnaround.

Confederation of Zimbabwe Industries President Callisto Jokonya said Gono must take firm action to implement his proposals, but said he was pleased with the proposals.

More reports from VOA's Studio 7 for Zimbabwe...