Zimbabwe: New generation of Zimbabwean dollars issued November 12

Event

On Tuesday, November 12, Zimbabwe's central bank issued the country's new generation of Zimbabwean dollars. The measure is part of monetary reforms to ease ongoing acute cash shortages and to have the country revert to its own currency following a decade of use of foreign and electronic options. Long lines were reported at banks across the country as Zimbabweans have long been unable to withdraw earnings and savings. It remains unclear if the new notes will help addressing the country's severe cash issues.

Context

Zimbabwe has been experiencing a deteriorating economic situation and severe liquidity shortages in recent years. The Zimbabwean dollar was abandoned in 2009 in favor of a multi-currency system, forcing the country to rely on foreign currencies, mostly on US dollars and South African rands. In 2016, a "bond note" currency pegged to the US dollar was created to combat hyperinflation, but its value fell quickly. In February 2019, the government introduced an electronic currency called the RTGS dollar, which also fell due to high speculation. A decree issued in June, banning the use of foreign currencies in local transactions failed to sustain the RTGS dollar. In August, the inflation rate reportedly hit 300 percent (according to the International Monetary Fund).

Advice

Individuals traveling to Zimbabwe are advised to bring sufficient reserve of cash.