Posted on July 21, 2005

Mugabe Cash Not Worth The Paper

Jan Raath, The Australian (Sydney), July 21

PRESIDENT Robert Mugabe’s regime asked South Africa for a $US1 billion ($1.33 billion) rescue package this week to buy food and fuel. Well it might: Zimbabwe’s currency has been so debased by inflation that it has become virtually worthless.

The cost of running my small office and two part-time workers hit $Z1 million this month ($121). In 1980, that is what it cost the Rhodesian Government to run an army of 40,000 men for a day when it was fighting Mr Mugabe in the civil war for black majority rule.

When Roy Bennett, a former opposition MP, finished his jail sentence this month for shoving one of Mr Mugabe’s ministers, he received the release gratuity of $Z6 to help him “re-enter society”.

It showed how sublimely out of touch the Government is. A box of matches costs $Z1000.

Total government spending in 2002 was budgeted at $Z5 billion. Today, that would fill a mere 10 supermarket trolleys with groceries.

Inflation hit 164 per cent last month. Economists predict it will double in five months, and again three months after that. This time last year, pound stg. 1 fetched $Z8500 on the black market, increasingly the only real exchange. Yesterday it fetched $Z54,000.

Five years ago, Zimbabwe’s economy was arguably the continent’s second-most robust and diverse after South Africa’s. It has shrunk 5 per cent a year since 2000, when Mr Mugabe went to war against white farmers, the opposition, churches, judiciary, the press, private enterprise and anyone else he saw as a threat.

The $Z20,000 bill is the currency’s highest denomination and its most common unit. It is not a banknote, however, but a bearer cheque — and most carry a 2004 expiry date.

People carry a fat wad of 50 bills — called a “bar” after the days a bar of gold was worth $Z1 million — just in case they find a petrol station with fuel and a short queue.

Almost always, however, the lines outside service stations are “hope queues” where drivers leave their cars to gather dust.

The Government has cut fuel prices for buses and minibuses to $Z6000 a litre, so minibus drivers fill up, drive around the corner and sell the fuel for up to $Z120,000 a litre, then rejoin the queue.

On the rare occasions I can fill up my car, it costs me $Z1.5 million.

On Saturday, riot police arrived at my local supermarket to beat back a queue of about 700 people waiting to buy sugar, which had just been delivered. Last week, I had struggled through a crowd for a loaf of bread, only to have someone steal it out of my basket.

It has not been a bad few days, though. Yesterday I successfully queued for gas, after a month of cold midwinter showers. On Saturday I found bread and milk, and even cooking oil made a brief appearance. But as I left the supermarket a respectably dressed white woman begged me for money. Never before had I had such an encounter in Zimbabwe,