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| Mugabe launches new currency in 'last gamble' for Zimbabwe Mugabe launches new currency in 'last gamble' for Zimbabwe | |
| (about 11 hours later) | |
| Zimbabwe has launched a controversial new currency in a last ditch bid to inject desperately needed cash into its failing economy. | Zimbabwe has launched a controversial new currency in a last ditch bid to inject desperately needed cash into its failing economy. |
| Many ordinary people fear the new “bond notes”, issued on Monday by the central bank in Zimbabwe, will trigger economic chaos, wiping out savings and causing massive hardship for millions. | Many ordinary people fear the new “bond notes”, issued on Monday by the central bank in Zimbabwe, will trigger economic chaos, wiping out savings and causing massive hardship for millions. |
| Zimbabwe has been ruled by Robert Mugabe, 92, since 1980. Some observers have called the bond notes the autocratic president’s “last gamble”. | Zimbabwe has been ruled by Robert Mugabe, 92, since 1980. Some observers have called the bond notes the autocratic president’s “last gamble”. |
| The central bank says bond notes will ease crippling shortages of currency, but there are fears their introduction could encourage rampant printing of cash, as happened in 2008. | The central bank says bond notes will ease crippling shortages of currency, but there are fears their introduction could encourage rampant printing of cash, as happened in 2008. |
| Only the introduction of the dollar as the official currency in 2009 halted an economic meltdown. | Only the introduction of the dollar as the official currency in 2009 halted an economic meltdown. |
| In recent months there has been unrest after the Zimbabwean government was repeatedly forced to delay salary payments to teachers, doctors, soldiers and administrators. | In recent months there has been unrest after the Zimbabwean government was repeatedly forced to delay salary payments to teachers, doctors, soldiers and administrators. |
| The country is also suffering high unemployment, a severe drought and is threatened by famine in some parts. | The country is also suffering high unemployment, a severe drought and is threatened by famine in some parts. |
| The bond notes will be officially interchangeable 1:1 with the US dollar, and banking officials said last week they would be deposited directly into US dollar accounts, where they would be reflected as dollar balances. | The bond notes will be officially interchangeable 1:1 with the US dollar, and banking officials said last week they would be deposited directly into US dollar accounts, where they would be reflected as dollar balances. |
| Few appear reassured. “I just want to try to purchase something from one of the big supermarkets,” said Tennison Tigere, a 36-year-old street hawker, shortly after withdrawing $50 of bond notes from a bank in Harare, the capital. | Few appear reassured. “I just want to try to purchase something from one of the big supermarkets,” said Tennison Tigere, a 36-year-old street hawker, shortly after withdrawing $50 of bond notes from a bank in Harare, the capital. |
| “People are sceptical because of what happened to our old currency in the past when the money lost its value. That is why they think it could happen again.” | “People are sceptical because of what happened to our old currency in the past when the money lost its value. That is why they think it could happen again.” |
| Pro-government newspapers announced the issue and said “the majority of people” were optimistic that the new notes would resolve “the cash shortages afflicting the economy”. | Pro-government newspapers announced the issue and said “the majority of people” were optimistic that the new notes would resolve “the cash shortages afflicting the economy”. |
| However, news agencies reported a run on the banks as Zimbabweans tried to empty their accounts of hard currency. | However, news agencies reported a run on the banks as Zimbabweans tried to empty their accounts of hard currency. |
| The prospect of the introduction of the notes has also fuelled some of the largest protests in a decade against Mugabe. This month, authorities arrested dozens who were planning to demonstrate against the move. | The prospect of the introduction of the notes has also fuelled some of the largest protests in a decade against Mugabe. This month, authorities arrested dozens who were planning to demonstrate against the move. |
| Those detained include Patson Dzamara, a high-profile opponent of Mugabe and the ruling Zanu-PF party, who was found at a local hospital 24 hours after his burnt out car was discovered. | Those detained include Patson Dzamara, a high-profile opponent of Mugabe and the ruling Zanu-PF party, who was found at a local hospital 24 hours after his burnt out car was discovered. |
| Dzamara – who appeared to have been badly beaten with sticks, according to pictures posted on social media – was one of the coordinators of a coalition of opposition groups that had pledged to “shut down” major cities in Zimbabwe to protest against corruption, alleged human rights violations and the bond notes. | Dzamara – who appeared to have been badly beaten with sticks, according to pictures posted on social media – was one of the coordinators of a coalition of opposition groups that had pledged to “shut down” major cities in Zimbabwe to protest against corruption, alleged human rights violations and the bond notes. |
| The UK and the EU condemned the arrests. | The UK and the EU condemned the arrests. |
| Observers say the pressure on Mugabe, Africa’s oldest leader, and the Zanu-PF party is immense. Ignatious Chombo, Zanu-PF’s administration secretary, accused western embassies in Harare and opposition parties of trying to cause anarchy. | Observers say the pressure on Mugabe, Africa’s oldest leader, and the Zanu-PF party is immense. Ignatious Chombo, Zanu-PF’s administration secretary, accused western embassies in Harare and opposition parties of trying to cause anarchy. |
| Mugabe will seek re-election in 2018. Zanu-PF retained power after elections in 2013, which were tainted by allegations of vote-rigging. | Mugabe will seek re-election in 2018. Zanu-PF retained power after elections in 2013, which were tainted by allegations of vote-rigging. |
| Tendai Biti, an opposition politician, predicted earlier this month that the bond notes would be a disaster. He said: “We are already in a disastrous situation. We are in a deep recession. If you add bond notes there will be the return of the black market, hyperinflation. It will be a dog’s breakfast.” | Tendai Biti, an opposition politician, predicted earlier this month that the bond notes would be a disaster. He said: “We are already in a disastrous situation. We are in a deep recession. If you add bond notes there will be the return of the black market, hyperinflation. It will be a dog’s breakfast.” |