Reuters - Video

Edition: US | UK | IN | CN | JP

video Finance Videos

Zimbabwe's new bond notes: the view on the street

Friday, December 16, 2016 - 01:29

Zimbabwe's new bond notes - issued last month as a quasi-currency to ease a serious cash crunch - may have prompted hyperinflation fears, but local vendors say they're now able to sell their goods more easily. Hayley Platt reports.

▲ Hide Transcript

View Transcript

Business is slow at Grace Mlambo's vegetable stall in Harare. Years of hyperinflation has taken its toll on Zimbabwe's economy. A disastrous episode of money printing led to its own currency being dumped in favour of the US dollar. Now the country is running out of cash. The government hopes a new quasi currency could be the answer. Last month introducing $10 million worth of new bond notes and coins. (SOUNDBITE) (English) VEGETABLE VENDOR, GRACE MLAMBO, SAYING: "People seem to have more money, so I will be able to build up my business. I think by mid-March or April if the bonds are successful things will be okay." Businesses are being encouraged to accept the bonds. But consumers fear it could cause a return to hyperinflation. (SOUNDBITE (English) ECONOMIC ANALYST, ALPHONSE MBIZVO SAYING: "People have not been able to access their money in a long time and most of them are desperate. This is the festive season people need to buy stuff for the holidays." Hawkers especially rely on small change to make sales. But Zimbabweans have long memories. And many are worried the substitute currency will quickly lose value. There've been protests and a bank run of people emptying their bank accounts of hard currency. The new bonds have been trading one to one against US dollars. But they can only be spent in Zimbabwe.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Zimbabwe's new bond notes: the view on the street

Friday, December 16, 2016 - 01:29