Zimbabwe News

Informal traders reject Zimdollar notes

Harare vendors now refuse Zimbabwe dollar notes, commonly known as bond notes, due to the introduction of the new ZiG dollar.

Consequently, consumers must purchase items not on their shopping lists because traders cannot provide change for amounts less than US$1.

Despite RBZ Governor John Mushayavanu’s declaration that old notes would no longer be legal tender by the end of April, traders continue to reject them.

Moreover, Mushayavanhu said ZiG notes and coins will begin circulating in the economy on April 30, 2024, to allow the Reserve Bank to undertake an intensive educational and awareness campaign on the key security features of the ZiG notes and coins.

In an interview with NewZimbabwe.com, Jane Makura, a vendor from the Dzivarasekwa high-density suburb, expressed sentiments likely shared by many ordinary citizens. She said:

I do not know whether bond notes still work. What if I let people use them at my stall and later know they are now worthless?

This is another mistake. They should just let us trade in US dollars and leave this culture of changing currencies and removing zeros.

Most tuckshops in Dzivarasekwa, Warren Park and Highfields and other high-density suburbs are no longer taking the banknotes.

The new ZiG, described by NewzWire as “Mushayavanhu’s clever way of removing zeros from Zimbabwe’s currency”, has been introduced at an exchange rate of US$1 to ZiG$13.5.

Last week, economist Gift Mugano said the new currency failed before it was launched mainly because it was not backed by sufficient reserves.

Mugano outlines seven factors which he believes will undermine ZiG namely (1) a large informal sector (+80% of the economy); (2) drought of confidence; (3) drought of production; (4) printing of money & excessive liquidity caused by treasury; (5) lack of national cohesion and consensus; (6) lack of policy clarity; and (7) external shocks (drought & subdued commodity prices).

Meanwhile, most major retail outlets such as supermarkets are still taking the Zimdollar notes.

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