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Zim introduces new bank notes
31/07/2007 11:59 - (SA)
Harare - Zimbabwe's central bank on Tuesday introduced yet another higher denomination banknote as it grappled with runaway inflation, which was rendering lower-value banknotes useless.
The new Z$200 000 bearer cheque was the latest addition to a series of temporary bank notes introduced as a stop-gap measure at the height of a critical shortage of bank notes.
It was worth $800 at the official rate and one US dollar at the parallel market rate.
The Reserve Bank of Zimbabwe said in an advertisement in the government-run Herald newspaper on Tuesday that it was "introducing the new $200 000 bearer cheque with effect from 01 August 2007 for your convenience".
Zim 'experiences critical cash shortages'
Zimbabwe was in the throes of chronic economic crises with inflation well past the 5 000% mark, four in every five people jobless and no less than 80% of the population living below the poverty threshold.
In July last year, the central bank slashed three zeros from the country's currency and introduced new bank notes for the convenience of shoppers who had resorted to carrying rucksacks full of banknotes to buy ordinary groceries.
The current series of bearer cheques was due to expire on Tuesday, but the central bank extended their life-span on Friday to July 31 next year.
The local dollar, which was almost at parity with the pound sterling at independence from Britain in 1980, was now pegged at $250 to the greenback at the official rate, but fetched up to $185 000 on the black market.
Between May and September 2003 the country experienced critical cash shortages, which prompted the reserve bank to issue three of the new temporary notes, the highest of which was for Z$20 000.
Last month, President Robert Mugabe's government ordered businesses to halve the prices of their goods and services, saying some shop owners were colluding with Mugabe's enemies to plot his downfall by incessantly increasing prices and fuelling inflation.
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