Tuesday, August 18, 2009

Zimbabwe Produces Funny Money

The Zimbabwe Central Bank has introduced a new form of money in an attempt to alleviate the desperate shortage of cash in the country.

A previously unknown and officially sanctioned financial instrument called a "bearer cheque" has been launched and copies have started to be dispensed from bank machines across the country.

The cheques are printed on banknote paper, look like banknotes and are described as being as "good as cash".

An anonymous senior Harare bank executive describes the new cheque as "an invention. I have never heard of it before. For a central bank to issue something called a bearer cheque is probably unique." The stop gap measure has been caused by what the government has described as "hoarding" but the above source goes on to say that, "With inflation now at 427 percent, it means that five times as much cash is needed now than a year ago.".

Zimbabwe has been classified by the United Nations as having the fastest shrinking economy in the world - with gross domestic product forecast to tumble 12 percent this year.


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