Masakadza ton; the pathetic economic stage of Zimbabwe

As I had posted earlier, the practice matches are practice matches and not much of significance be attached to the scores or the results. Sri Lanka, coming off a 4-2 series defeat in New Zealand, had their confidence further dented by  Zimbabwe  is the news.  Dimuth Karunaratne top-scored with 58 in Sri Lanka's 279 for 8 as it batted first after winning to toss at the Bert Sutcliffe Oval.  Zimbabwe made surprisingly easy work of running down that total on the same pitch on which they reduced New Zealand to 157 for 7 in a rained-out match on Monday. After slipping to 35 for 2, Brendan Taylor (63) put on 127 for the the third wicket with Masakadza, who then saw Zimbabwe comfortably home in an unbroken 119-run partnership with Sean Williams (51).

There has not been much to cheer about for Zimbabwe, the landlocked country in Southern Africa between the Zambezi and Limpopo rivers. It is bordered by South Africa, Botswana, Zambia and Mozambique.   What is now Zimbabwe was historically the site of many prominent kingdoms and empires, as well as a major route for migration and trade.  The not so happy news of  Central bank chief John Mangudya's announcement dealt another blow to elusive hopes of a solid economic recovery in the southern African nation that had to abandon its own currency at the peak of a severe recession and switch to the US dollar instead. Mangudya said the economy remained too depressed to allow for any salary hikes. "Given the lack of competitiveness and its negative effects on the economy, we do not see any room for wage and salary increases," Mangudya said. The wage freeze will apply to civil servants and parastatal companies, but to the dismay of unions, private companies were expected to follow suit.  The World Bank says 72 per cent of Zimbabweans live below the poverty line, while many economists put the real unemployment rate at 80 per cent, up from an official 11 per cent.

The Balancing Rocks are geomorphological features of igneous rocks found in many parts of Zimbabwe, and are particularly noteworthy in Matopos National Park and near the township of Epworth to the southeast of Harare. The formations are of natural occurrence in a perfectly balanced state without other support. Their popularity grew when the Reserve Bank of Zimbabwe featured the formations on the last series of Zimbabwean banknotes.  The Balancing Rocks have been used as a metaphorical theme to explain the importance of development coupled with preserving the fragile environment of Zimbabwe as similar to that of the Balancing Rocks found in Epworth, Matopos and in other areas.

The Reserve Bank of Zimbabwe has its origins in the Bank of Rhodesia and Nyasaland which was created in March 1956 as a central bank for the Federation of Rhodesia and Nyasaland. The Reserve Bank was the successor to the Central Currency Board, which had the sole right to issue currency.  The paper money of Zimbabwe were physical forms of Zimbabwe’s four incarnations of the dollar ($ or Z$) from 1980 to 2009. The banknotes of the first dollar replaced those of the Rhodesian dollar at par in 1980 following the proclamation of independence. The Reserve Bank of Zimbabwe issued most of the banknotes and other types of currency notes in its history, including Bearer cheques and Agro cheques.  The banknotes of the third dollar were originally scheduled to be demonetised on 30 June 2009 but the Zimbabwean dollar as a whole has been suspended since 12 April 2009, implying that banknotes of both the third and fourth dollar are not de jure legal tender.

Once known for its billion dollar notes and hyper-inflation, Zimbabwe must be the only place in the world to have eight currencies as legal tender - none of them its own. For the last five years most people have been using US dollars or South African rand, but pula from Botswana and British pound sterling have also been changing hands. The Central  bank is also allowing the use of Australian dollars, Chinese yuan, Indian rupees and Japanese yen.  The customers can open bank accounts in these currencies but the hard cash is not yet in circulation.

There has been surge in counterfeit notes. Given the complexities of the multiple currency system, there are fears that forgery will be easier with unfamiliar notes.  Zimbabwe's liquidity crisis means shopkeepers and market traders often give change in sweets, airtime for mobile phones and even condoms.  For economist Christopher Mugaga, the introduction of new currencies is not the solution to Zimbabwe's economic woes, with its chronic unemployment and shrinking manufacturing sector.

During last year's election campaign, allies of President Robert Mugabe hinted at this, prompting warnings it could lead to a return of hyper-inflation, which was cured by the introduction of foreign currencies. The Zimbabwean dollar (sign: $, or Z$ to distinguish it from other dollar-denominated currencies) was the official currency of Zimbabwe from 1980 to 12 April 2009, with a period of inflation, followed by hyperinflation. Despite attempts to control inflation by legislation, and three redenominations (in 2006, 2008 and 2009), use of the Zimbabwean dollar as an official currency was effectively abandoned on 12 April 2009 due to the skyrocketing inflation.

Sad to read of the economic situation of the country

With regards – S. Sampathkumar

12^th Feb 2015.