Hope, fear over new bond notes

HARARE - Ordinary Zimbabweans have expressed a mixture of both hope and fear over today’s introduction of bond notes into the market by under pressure authorities who hope that the surrogate currency will ease the country’s severe cash shortages.

Many Harare residents who spoke to the Daily News yesterday also said as fearful as they were of the bond notes — given their terrible experiences with the now decommissioned Zimbabwe dollar a decade ago — they felt that they had little choice but to accept the promissory currency in the hope that things would turn out well in the end this time around.

The country’s seemingly unending political crises, which are widely blamed on President Robert Mugabe  and his ruling Zanu PF, precipitated an economic meltdown of monumental proportions in 2007/8, culminating in the death of the Zimbabwe dollar, mass emigrations from the country and a sharp increase in poverty levels.

Chitungwiza resident, Juliet Vhera, 35, said while she was happy that the bond notes had finally arrived, which brought with it chances of solving the country’s debilitating cash shortages, the government needed to make sure that their introduction and use would be well-managed to avoid worse problems.

“We definitely need that money. But a mechanism must be put in place to make sure that this money works well. For the past few months people have been struggling to get cash and the coming in of the bond notes will help to solve the problem. Hopefully, we won’t have to sleep in bank queues again,” she said.

Zivanai Kusangaya, 34, from Epworth also said it was his hope that the introduction of bond notes would help to ease the country’s cash challenges if handled properly.

“There is nothing we can do to stop the bond notes. The only thing we can do is to accept these bond notes. However, they must ensure that the bond rate remains at 1:1 to the US dollar in order to avoid more problems soon, such as shortages of basic commodities in shops.

“We have been eagerly waiting for the bond notes because currently we have rent arrears and our landlords need their money. We also need money to feed our families,” he said.

Tendai Chikanyi, 33, from Kuwadzana said it was his hope that the country’s “sick economy” would start to function again with the introduction of the bond notes.

“For me this appears to be the only solution left for the country to solve the current cash shortages. While people are free to criticise the idea, what else is there to be done differently? Let’s just all wait and see what happens. On the other hand, our lives can also turn for the worst with the coming in of the bond notes,” he said.

Osias Chikwashi, 18, from Avondale also called for people to support the bond notes as he felt they had a chance of easing the country’s cash problems.
“My parents are both late and I am failing to go to school due to the current economic problems. I think the bond notes will help to solve the problem of cash challenges,” he said.

“We welcome the bond notes as we were failing to withdraw our money from banks and the queues were getting too long. But the relevant authorities must make sure that there will be no shortages of basic commodities in shops,” Tichaona Chihota, 30, of Greenwood Park, said.

“While we are very happy with the coming of the bond notes, what Zimbabwe really needs is a functional economy that will deliver the right outcomes long term,” Edmore Nhashi chipped in.

However, the Zimbabwe National Students Union (Zinasu) said the currency was “the biggest” threat to the right to education in the country.

“In 2008, when the Zimbabwean dollar became more useless than the German mark during the time of the Weimar Republic, most universities closed only to re-open after the signing of the GNU (government of national unity).

“The huge number of students who have recently dropped out of college due to the biting economic crisis is nothing compared to the number of those who are going to be forced out of school after the introduction of the bond notes,” he said.

In a statement released on Saturday, the Reserve Bank of Zimbabwe announced that it would release bond notes worth $10 million onto the market today, with withdrawal limits set at $50 per day and $150 weekly.

The notes would come in $2 and $5 denominations, and would be pegged at 1:1 against the United States dollar. A new $1 bond coin would also be introduced.

“This measure is in tandem with the objective of the bank to release bond notes into the market on a measured basis which is critical to mitigate abuse of bond notes.

“The bond notes will be released into the market through normal banking channels in small denominations of $2 and $5 to fund export incentives for up to five percent which will be paid to exports of goods and services and Diaspora remittances.

“The use of bond notes within the multi-currency exchange system, which are anchored by the $200 million (AfreximBank) facility, will operate along the same lines as bond coins.

“The banking public is advised that no new accounts will be opened as bond notes will be deposited into existing US dollar accounts,” the central bank said.

Comments (6)

shame, very very soon, those welcoming the bond notes due to their little knowledge will crying if not dead.

shame - 28 November 2016

black market starting soon...

Young Zimbo - 28 November 2016

kkkkkkk do these people really know what money is? I don't think so, even the US$ that you're crying for is not money, it's a currency. I don't blame these guys that are welcoming this bond paper because even your reserve bank governor doesn't know what money is.

misty - 28 November 2016

Bond notes cannot make the economy function.The economy can only function when industries start to run again,and when we begin to export and get foreign currency.Those who are welcoming the bond notes are doing so out of ignorance of how an economy works.It is a stop gap measure with very devastating consequences.Very soon all basic commodities will disappear from the shelves and the USD will just vanish into thin air which will force our clueless government to print more and more bond paper thereby fuelling inflation.Kunonzi kufarira n'anga neinobata mai.Mark my words.

Janana wa Bikaz - 29 November 2016

The whole system is f..cked up. Now the independent media has been bought by the advertising contracts. Banks are in at well. They created the problem under watch of the RBZ using the money multiplier concept to loan USD they did not have in electronic money. Yes the RBZ will limit it printing to to $200 million cash but create $2 billion in electronic money. Civil Servants bonuses this year will be paid on time. It's that simple. It will take about 6 weeks for the effect to be clearly conceptuliased by some of the idiots that we have in Zimbabwe as citizens.

Gweshuro - 29 November 2016

I am pretty sure all the morons who are celebrating bond notes do not know exactly what's coming and what this really means for the economy and the general public, it means prices of goods are going to sky rocket, in fact everything is gonna rise, black market will reappear because people still need forex to purchase most goods from outside of the country since we are producing very little to nothing, most will sell their properties just to get the forex leaving many much poorer, there will definitely be hyperinflation of the bond paper as it will never be possible to par bond paper with a functioning universal currency therefore the zeros will multiply, morons will be buying a loaf of bread for 10,000 bond very very soon but if you got US$ you'll probably get it for a dollar, folks this is what's called wealth transfer that's about to happen, there's no forex cash shortage in zim but now there's gonna be massive forex shortage because of the intro of the bond please understand me. This was just a well orchestrated move by the gvt to steal people's wealth ie money, properties etc, some banks will collapse as well so folks beware hard times are around the corner for most people. Do you honestly think mangudya and mugabe don't know that printing bond notes will create big problems for the economy? If that's what you think then think again. They know exactly what they are doing trust me. Twumapurisa twairova people who were demonstrating against bond ndo twuchapfidza because very soon all civil servants will be paid in bond note, people must learn from history!!

misty - 29 November 2016

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