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Queues
continue as angry Zims battle cash crisis
The
Zimbabwean
January 16, 2008
View
article on The Zimbabwean website
Harare - Serious cash
shortages across the country and queues of thousands of angry depositors
outside banking halls worsened in the last week, playing havoc with
the election campaign of President Robert Mugabe's ruling Zanu (PF)
party.
Pavements in the centre
of the capital, Harare, are clogging daily as queues wind sometimes
in three coils round the block and depositors wait for around six
hours to be served. In downtown Harare, people sleep in sanitary
lanes in banking lines stretching sometimes 100-metres long. Often
the reward is minimal. Many banks are still rationing their customers
to between Z$20million and $50 million. But the need is frequently
desperate, demonstrated by the occasional fistfights over queue
jumping. At points along the queues, knots of people can be seen
talking, often animatedly.
"These
queues have become unofficial MDC rallies," said a security
guard at one commercial bank downtown Harare. "Everybody shouts
about Gono, Mugabe and Zanu (PF)." Central back chief Gideon
Gono blames the crisis on cash barons who he accuses of holding
on to huge sums of cash, which he claims is fuelling the black market.
His desperate
measures last month to introduce three higher denomination notes,
a Z$250,000 note, a Z$500,000 and Z$750,000 bill have so far been
a spectacular flop.
Maria Moyo, an office
clerk queuing for cash at Beverly Building Society along Robert
Mugabe Avenue, launched into a furious tirade against Gono and Mugabe
when she was approached by The Zimbabwean to comment on the cash
crisis.
"Gono and Mugabe
are monumental failures and they should just go," she charged.
"Can you believe that I have not been able to withdraw my bonus
which I earned on December 15 and this January 14? This is money
I worked for. It wasn't a donation."
Another furious depositor
at CBZ said he had totally lost confidence in the banking system
and said he was better off doing "pillow banking." Economists
say the shortage of cash in the country is not a result of cash
barons as Gono claims, but that the Z$100 trillion currently in
circulation is inadequate for 11,9 million people. Experts say if
this cash is divided equally among say six million economically
active people, there would only Z$16,6 million for each person,
only enough to buy a 50ml tube of Colgate toothpaste.
"The country is
operating in a hyper-inflationary environment, which requires huge
volumes of cash to complement the skyrocketing prices in the economy,"
Zimbabwe Allied Banking Group chief economist David Mupamhadzi said.
Godfrey Kanyenze,
chief economist for the Zimbabwe
Congress of Trade Unions (ZCTU), which is weighing mass protests
over the cash shortages, said there was no incentive for keeping
cash in the bank.
"What's the point
of depositing money when you can't get it out?" he said. Critics
say Gono, as an unelected official has become overly powerful, and
many wonder where he gets the power to change rules governing privately-owned
money without having to go to Parliament, without consultation with
the financial sector or commercial bankers. Just two weeks ago he
unilaterally reversed a decision to phase out the Z$200,000 note,
after persuading individuals and retailers to deposit the bill with
banks, saying it would be as "good as manure" after December
31. He claimed the note had been siphoned out of the banking system
by black market foreign currency dealers.
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