If you were having coffee with me, I would be glad you stopped here to check up on dear old me, you ask me why I seem so pensive. I would tell you its been a long week today, well its one of those days you something and think someone wake me up from this nightmare…
Our metal puppets dancing to the strings soft as wool pulled by an unseen hand hiding in the shadows?
If you were having coffee with me I would tell you today I woke up to some *insert necessary adjective here* “news” that Statutory Instrument 142 of 2019 had been issued and with effect from the 24th of June 2019; Zimbabwe wold stop being a multi currency state, and have the Zimbabwean Dollar as the sole currency for legal tender.
When this regulation first made an appearance today, it was hard to figure out if it was fake news or not as there had been no warning or an official communication until later during the day when it made the news bulletins on radio, TV, print and electronic media.
if you were having coffee with me, I would tell you how on my evening commute home, everyone was still trying to figure out, the implications of this statutory instrument some arguing it would not work others wanting to give it a chance
Incase you are wondering why this is all such a big deal; its because at some point in our history around 2008 we lived through a hyper-inflationary era that saw the Zimbabwean dollar devalue spectacularly until we eventually “dollarised” and the Zim Dollar devalued at about USD$5 to 5 quadrillion zim dollars as we adopted a multi-currency system
Using forex as a currency has its drawbacks and that led to the creation of the surrogate bond currency that was meant to trade with United States Dollar at a value of 1:1
If you were having coffee with me,I would tell you that the government tried to keep the value at 1:1 but eventually they conceded that the bond was losing value, to date the official RBZ interbank rate is at 1:6 with the United States Dollar while on the black market it was going up everyday and was at 1:12 today.
Consequently the prices of goods and services has been going up almost daily, its easy to see why people would prefer to trade in United States Dollar than our bond currency
Effectively this statutory instrument brings to an end the local trading using a multi-currency system and brings back our Zimbabwean dollar back from where demonetised currencies go to die, well, the new currency is not quite here, but technically it is since the Bond Currency and the RTGS currency will be trading 1:1 with the Zimbabwean Dollar (yes we have a currency called the RTGS, dont even ask about that I dont understand the differences and it doesnt matter now its all Zim Dollar)
What does this mean ?I dont know economics but I know perception and confidence play a lot in the success and stability of an economy and right now there’s not much of confidence in the government, the economy and the Zim Dollar, which means there’s going to be resistance and rise of black market dealings and probably more shortages. I understand why countries need to have their own currencies but we are nowhere near ready to just be waking up and making such sweeping changes…
PS Continuing the #winterabc after taking time out to mourn the death of a family friend