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Sunrise II - Index of articles and reports on Gono's attempt to change the currency in 2007
Gono's
promise fails to open banks
Karima Brown, Business Day
(SA)
December 31, 2007
http://www.businessday.co.za/articles/topstories.aspx?ID=BD4A668916
While beleaguered
Zimbabweans turned out in droves after pledges by senior government
officials that banks would remain open over the Christmas period,
banks stayed closed.
The undertaking by the
central bank governor, Gideon Gono, to cash-strapped Zimbabweans
failed to materialise, and long lines of people desperate for local
currency queued at the few automatic tellers that were dispensing
cash.
The country is beset
by rampant inflation, mass unemployment, and shortages of food and
basic goods.
To add to its woes, Zimbabwe
is now suffering shortages of banknotes as well, despite the introduction
of higher-denomination notes last week.
Gono last week said that
banks would remain open on Christmas Day and on Boxing Day to dispense
cash after the introduction of the new notes failed to cut long
queues at banks.
But reports from Harare
yesterday said the banks were closed, leaving customers empty-handed
and forcing many to join the lines at cash machines instead.
News agencies reported
heartbreaking stories about how Zimbabweans who had managed to flee
their country were unable to send much-needed cash back to desperate
relatives who find themselves stuck with no way out of the economic
decline .
State-run media reported
on Monday that the central bank had put another Z$20-trillion (about
$667m at the official exchange rate, or $10m at the black-market
rate) into circulation by introducing new notes.
Long queues for cash
have become a common sight in Harare, but only a fraction of the
existing cash in circulation is to be found in the formal economy
— the majority is circulating on the black market.
Gono blamed the currency
shortages on foreign-exchange currency dealers, also known as "cash
barons".
He urged Zimbabweans
to report anyone flouting currency exchange laws.
Zimbabwe has the highest
level of inflation in the world at more than 8000%.
The opposition Movement
for Democratic Change has put the blame for the most recent crisis
squarely at the door of President Robert Mugabe. Mugabe's
detractors also accused him of allowing the economy to go to ruin
but he has remained defiant. Mugabe has thus far maintained that
the country's problems are a result of a western plot to oust
him from power.
The response from Zimbabwe's
central bank to the cash crunch was to issue high-value notes in
Z$750000 ($6 at the official exchange rate but $0,12 on the black
market), Z$500000 and Z$250000 denominations.
Before introducing the
new notes, Gono said Zimbabwe had Z$67-trillion in circulation,
although only Z$2-trillion was in the formal economy.
The black market has
flourished in step with the deepening economic crisis . With Reuters,
BBC
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