Zimbabwe’s central bank won’t say exactly when its controversial new bond notes will go into circulation this month, but the prospect has left many Zimbabweans worried. A protest is planned for later this week.
Zimbabwe’s radio and television stations have been flooded with Reserve Bank of Zimbabwe’s jingles promoting the bond notes saying they would be introduced any time this month.
The central bank says the bond notes will trade on par with the U.S. dollar and that they will ease the severe cash shortages Zimbabwe has been facing for close to a year now.
Not to be outdone, some Zimbabweans have started circulating on social media jingles denouncing the proposed bond notes.
That jingle says bond notes are the chemical agent that will finally destroy Zimbabwe’s ailing economy.
Linda Maupa says she will take part in a protest planned for Friday by the opposition and civic organizations against the controversial new bond notes.
“I think it is a way of stealing from us. Daylight robbery like what they did in 2007, 2008," Maupa said. "I feel we are being robbed. They are taking our U.S. dollars that are valuable and replacing them with bond notes that are just paper, printed paper. And we are not going to find goods in stores. The money cannot buy because it is not foreign currency. They need foreign currency to purchase things from outside the country. And if we have bond paper we are going to starve like we did in 2008.
Zimbabwe abandoned its own worthless currency in February, 2009 amid hyperinflation. Since then, it has been using all major foreign currencies but mostly the U.S. dollar.
Over the weekend, Zimbabwe Vice President Emmerson Mnangagwa said the government would go ahead with introducing bond notes despite threats of protests. He said bond notes are meant to slow down the smuggling of foreign currency out of Zimbabwe.
“The U.S. dollar is for international transactions. That is only found in Zimbabwe, a unique country, which is abusing the dollar," Mnangagwa said. "So we said we must make sure that we use the U.S. dollar for the purpose we designed it. So we needed to find a mode of transaction that is domestic because if you put $200 million into Zimbabwe today, after a few days it’s all gone. It is not even going through the banking system.”
Zimbabwe has struggled to pay civil servants over the past year as revenue from taxes and duties has fallen.
Analysts have long urged President Robert Mugabe’s government to attract foreign investors and promote exports to ease the cash shortages in Zimbabwe.
So far that advice seems to be falling on deaf ears and the country continues to import most food including bottled water, sweets, and toothpicks.
As part of measures to curb that, the governor of the Reserve Bank of Zimbabwe, John Mangudya, has introduced what he calls a “priority list” on what has to be approved to be imported.