Why Zimbabwe ban foreign currency

A headline of a local newspaper on the ban of the foreign currency is displayed on a street in Harare, Zimbabwe, 25 June 2019 Image copyright EPA

Zimbabwe goment don make controversial decision to ban di use of foreign currency including US dollars to do business for di kontri wit immediate effect.

Di goment don also return di Zimbabwe dollar wey dem bin abandon because price of tins bin high sotey di moni no get value for 2009. Na during dat time di kontri begin use US dollars and South Africa rand.

Dis goment decision shock Zimbabwe pipo no be small as dem no trust dia local currency. Di exchange rate wen dem bin stop to use Zimbabwe dollar na, $1 equal Z$35 times 1,000 raise to pawa five.

Wetin cause dis move?

Di economy dey in a mess. Na nearly evritin dem dey import and physical cash scarce no be small. Di cost of living dey high. Work no dey anywia.

Image copyright AFP
Image example Zimbabwe old moni bin dey totally worthless

Dem don try different kain tins to try solve di problem, sotey dem introduce bond notes for 2016 wey dem bin dey accept only for Zimbabwe.

Di value of di bond note suppose equal to US dollar but for real life im value small compare to di US dollars - so, before you know wetin dey happun black market start and Zimbabwe turn to cashless society, dem begin depend on card and mobile moni to do business.

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For February, dem turn bond notes and electric cash to RTGS dollars, den allow am float to try crush di black market.

But, workers wey dey collect dia salary for dollars discover say dia salary dey reduce wen e convert to RTGS dollar sake of inflation wey run up to 100%.

President Emmerson Mnagagwa say di ban na "important step to make di economy normal again."

"Even tho di di different currency periods helep stabilise di economy, e no give us control of monetary policy and e leave us at di mercy of di US dollar wey be di main cause of inflation," Mnagagwa tok.

Di authorities also say becauses di US dollars dey strong, to manufacture tins locally dey expensive dat na why we prefer to import tins.

Wetin be di reaction?

Pipo dey angry, irritated and annoyed.

Image copyright EPA
Image example Some traders don produce new price list. Here, iron wey dey cost $30 im price na Z$104

Most pipo wey dey connect di Zimbabwe dollar wit food shortage and inflation dey complain say dem no give dem warning. RTGS dollars become Zimbabwe only official moni on Monday.

"We suppose get our own currency. But dem for no just end am as if na fly dem dey pursue. Dem for give us notice," one man tell BBC.

Supermarkets and some oda formal business dem sharply respond di next day wit new price for Zimbabwe dollar - but many pipo no fit afford am.

To see doctor for di first time now na Z$1,800 - more dan wetin teacher or nurse fit collect as salary for one month.

Some traders wey dey run di economy and need US dollars to import dia market say dem no go obey di order.

One street vendor for di kontri capital Harare, tell BBC say, "how possible e dey say US dollars no dey acceptable again? E no go work. We even want more of di dollar so dat we street vendors go fit get am. Make dem remove di bond note instead."

Opposition Movement for Democratic Change (MDC) lawmaker David Coltart say di move na "sheer madness".

Dis objection go make any difference?

Di trade unions don threaten to do "mass i-no-go-gree" if dem no reverse di policy.

Image copyright Getty Images
Image example Katakata happun afta fuel price increase for January

Zimbabwe Congress of Trade Unions (ZCTU) want make dem pay workers wit US dollars again.

For January, di union lead protest against 150% fuel price increase, army and police attack di protesters and at 12 pipo die.

Black market traders still dey exchange and accept US dollars.

Di value for black market neva change - $1 equal Z$11, compare to di official rate wey be 6.2.

Why Zimbabwe pipo prefer foreign currency?

Dem neva forget wetin dem go through sake of mismanagement of di economy during Robert Mugabe goment. Dem bin force di Central Bank to print bank notes wit higher and higher value to cope wit inflation.

Image copyright AFP
Image example US dollars na di currency wey get pawa pass for Zimbabwe

Annual inflation reach 231 million per cent for July 2008. Officials stop to dey give month report wen inflation almost reach 80 billion percent for middle of November 2008.

Di price of tins bin dey multiply plenti times in one day. evne tho e bin dey illegal dat time, many pipo decide to keep US dollar wey dem bin buy for black market.

Business dem begin ask for foreign currency. Finally authorities no get choice, dem stop to use Zimbabwe dollar, come give permission to use different kains of currency including China Yuan and India rupee.

You fit buy sometin wit one currency, collect change for anoda currency.

But di truth be say, Zimbabwe no get all dis currency again because dem bin dey import more dan im dey export - and im don turn kontri witout cash.

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