Harare — AS the country searches for the best remedies to effectively close the last chapter of a traumatic economic spell, consumers have felt the bitter end of the shortage of coins.

Zimbabwe adopted the US dollar and the South African rand as the transaction currencies, now commonly referred to as the multi-currency system. While this was meant to enable the country remould its economic systems, the multi-currency system has hit hard small item consumers with regards to change whenever they buy goods.

Consumers now inevitably spend their small change on the spot, though saving a cent these days is critical, meaning discreet buying assumed lesser weight, as buyers have been forced to take an item for all small change in many instances than one. This is because the currency system currently in force does not allow for change to be given in the smaller monetary units although the price differences are such that there should be change.

In terms of the US dollar, a one-dollar note is the smallest unit locally, and now smaller units of the rand have to be used to make change. Transaction-wise, five rand is equal to 50 US cents. Although the transaction system allows for change for a purchase in US dollars to be given in rand, the amount of the latter, especially the smallest rand coins in circulation, is simply too small.

With the advent of the multi-currency system consumers worry so much about giving even the least of any of their foreign currency in light of their shoe string budgets.

Given this would not have done the consumers and small value transactions a great favour by adopting the South African rand, for many reasons than one? The current US dollar, rand currency system has also caused a rebirth of speculative tendencies characteristic of the forgettable era of the past few years.

Complexities arising thereof include illegal foreign currency peddling, which has caused the resurfacing of the Zimbabwe dollar dumped a few months back after it was condemned due to inflation.

The multi-currency system stabilised the country's macro- and micro-economic conditions and allowed for goods, rates and fares to be pegged in small price units instead of rounded off figures.

However, commuter operators as well, who cannot give change in denominations lesser than one dollar, have brought back into circulation the Zimbabwe dollars to close the change gap. Three trillion Zimbabwe dollars are equal to five South Africa rand. Furthermore, Zimbabwe has traders big and small still buying from South Africa and have to buy the rand at a high premium because its demand is outstripping current supply.

Considering our magnitude of economic relations with South Africa adoption of the rand, as the main transaction currency, would have made great economic sense for Zimbabwe.

Former South Africa President Kaglema Mothlanthe had agreed to an arrangement that would have seen Zimbabwe adopt the rand. Negotiations between the two countries' principals could have probably resulted in the printing of a given amount of rand notes and coins and with South Africa's help this would have been smooth.

This could also have possibly tempted Zimbabwe to join the Common Monetary Currency block comprising South Africa, Swaziland, Lesotho and Namibia, opening further cooperation avenues, economically. Whilst there were skeptics who were opposed to adoption of the rand predicting serious complexities for both countries, there were economists supporting a shared currency with South Africa.

One such economist is Steve Hanke, with the Johns Hopkins University in Baltimore (United States) and author of Zimbabwe: From Hyperinflation to Growth.

Quoted in the Star newspaper of South Africa Hanke said that "if viewed in a narrow profit-and-loss point of view, it is extremely profitable for South Africa".

"Through seigniorage, the revenue a central bank earns from issuing a currency whose face value exceeds the cost of printing or minting each unit of it.

"It is something that has worked very well for Washington, with 65 percent of all US dollars now circulating beyond their own borders without it dragging down in value," Hanke was quoted as saying.