Monday, January 07, 2008

Villagers trade in Rand

From Zim standard

Villagers in most parts of Matabeleland are selling their livestock in South African Rand, citing the volatility of the Zimbabwean dollar whose value continues to tumble against major currencies.

The government already levies "luxury imports" in foreign currency but has rejected suggestions to adopt the more stable Rand to shore up the economy, in free-fall for the past 10 years.

Reserve Bank of Zimbabwe (RBZ) governor, Gideon Gono, has warned against the widespread use of scarce foreign currency in the trade of local goods and services, which he says is illegal.

But villagers complain their savings are quickly eroded by rampaging inflation, now estimated at over 15 000%.

Their fears have been compounded by the month-long cash crisis during which the RBZ banned the use of $200 000 bearer cheques, which it said were being kept out of the system by so-called cash barons.

The ban was later reversed after the shortages worsened. Cattle for slaughter fetch anything above R3 000 or $600 million on the black market while goats were selling for R500 or $100 million during the festive season.

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