Maravi

(NEWZIMBABWE) Mujuru wants Zim to adopt Yuan

Mujuru wants Zim to adopt Yuan
by Staff Reporter
06/09/2010 00:00:00

VICE President Joice Mujuru said Monday that Zimbabwe should consider adopting the Chinese Yuan, in line with the country’s policy of using multiple currencies to tackle hyperinflation. Mujuru said China is now Zimbabwe’s biggest trading partner, with the Asian giant absorbing most of the country’s mineral and agricultural produce.

“Adopting the Chinese Yuan would be a logical step and could help solve some of the country’s liquidity constraints,” Mujuru was quoted as saying by South Africa’s 702 Talk Radio.

The multiple currency regime announced in January 2009 has been fraught with difficulties. Retailers are supposed to accept the Euro and the British Pound but those two currencies have never caught on, with most transactions being conducted in United States dollars, the South African rand and the Botswana Pula.

Shops have also struggled with change, forcing Finance Minister Tendai Biti to announce plans to import foreign smaller denomination notes and coins. Retailers have resorted to asking shoppers to take other goods in lieu of their change.

In some cases shoppers are given a "credit note" instead of their change when buying goods. The credit note can be redeemed for more goods later but only in the same shop.

Recent reports claimed some people had taken to washing dirty US$1 bills, worn-out from over-use to improve their appearance.
With the export sector still trying to recover from a decade-long economic crisis and the hoped-for windfalls from foreign donors not materialising, Zimbabwe has been hit by a liquidity crisis.

Finance Minister Biti last week said the multiple currency regime would remain in place until 2012 when ministers hope it would be replaced by a single currency for the Southern Africa Development Community (SADC).

Labels: CURRENCY, JOICE MUJURU, YUAN

posted by MrK @ 6:16 PM