“Bob” notes

14 10 2016
Any currency will do (almost)

Any currency will do (almost)

Here in Zimbabwe we have no currency of our own. It was finally discarded in February 2009 along with all 12 zeros that were commonly attached. Notes are now collected by curious collectors. The US dollar is the currency of choice but even that is running out, hoarded away from banks by a public terrified of the introduction of Bob notes. Oops, I meant BOND notes.

Bond notes you ask? Yup, notes with a US dollar value printed on them but no actual value outside Zimbabwe. An awful lot of people think that they will not have any value inside Zimbabwe too so are hoarding the real currency away from the banks.

So whose bright idea was this? Well, maybe I should explain what a Bob note, sorry it just seems to slip out, I mean BOND note, actually is. Earlier this year, as it became apparent that the government was running out of cash to pay its employees (some 80% of the budget goes on paying wages – the rest is siphoned by other means but maybe the figures are the wrong way around), the Reserve Bank of Zimbabwe (RBZ) came up with this workaround. They would get a bond of $200 million from a reputable external bank and print notes amounting to the same value for use solely in Zimbabwe. They were at pains to point out the last condition. After all, we already had bond coins which had been initially rejected by the public but had become accepted as a means of supplying change once the South African rand had ceased to have a convenient exchange rate of 10:1 to the US dollar. So why not have bond NOTES? Surely the public would understand and anyway, with parity to the dollar and no mention of bond notes being deposited into one’s account the cash crisis would be solved?

Right. Like there is any trust at all for anything this government suggests. Panic ensued. There was a run on the banks which was exacerbated by the restrictions that were imposed on drawing cash and promises from sources that it was NOT a reintroduction of the Zimbabwe dollar just made things worse. Riots ensued and now diesel is short. Point-of-sale (card swipe) machine supplies ran dry and banks couldn’t install what stocks they had fast enough. Predictions of food shortages proved false (well not in the supermarkets) and cash money now commands a premium of up to 15% over transfers and card swipes.

So we’ll accept just about any currency. The bond notes were due to be introduced this month but have now been deferred to next month. Maybe it will be added to the list on the bottom of the till slip but I’m willing to be there will be a few zeros too. Oh, I paid in cash. US dollars.

The term Bob note is a reference to the name of the Zimbabwean president – Robert Mugabe. It’s not my creation but has appeared on the social media recently.


 

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One response

16 10 2016
gonexc

There are some choice articles in the press about the whole debacle; check out this link https://www.theindependent.co.zw/2016/10/14/govt-clueless-economy/ Does the bond from the Afrex Bank even exist?

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