16 February 2017

Zimbabwe: Here They Come - Zimbabwe 'To Roll Out 10, 20 Bond Notes'

Photo: The Herald
Bond Note.

Less than two weeks after President Robert Mugabe's government unexpectedly introduced 5 US "bond notes", a state-controlled newspaper says notes in denominations of 10 and 20 are likely to be introduced too.

Said the Herald in a line buried in a news piece in the Crime and Courts section on Wednesday: "Government is... expected to gradually roll out the $10 and $20 notes."

The bond notes were first introduced in denominations of 1 and 2 at the end of November, ostensibly to ease a cash shortage by stopping the externalisation of hard cash. The notes have no value outside the country - but they are also causing havoc within Zimbabwe, where it's quickly becoming clear they are not interchangeable with the US, as the government insists they are.

Some shops are already offering discount to customers paying with hard cash, while forex merchants sell US at a 20 to 30% premium to those unable to withdraw it from their bank accounts, News24 has learnt.

Many Zimbabweans fear the bond notes will go the same way as the Zimbabwe dollar bearer cheques of the pre-2009 era: introduced in ever-increasing denominations only to quickly become worthless. A 100-trillion dollar banknote was issued in early 2009.

Before the bond notes were issued, the authorities said no-one would have more than 19 US dollars worth of them in their purses or wallets. It's clear now that that promise will not be kept, if bond notes in denominations of 20 are to be brought in.

Although, of course, if the real value of the bond notes slips significantly, then 20 bond notes will be worth nothing near 19 US.

Source: News24

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