Many Zimbabwe Shops Run Out of New Bills
Tuesday, August 22, 2006; 3:24 PM
HARARE, Zimbabwe -- Confusion and frustration reigned as Zimbabwe switched to new currency Tuesday to try to tame its hyperinflation, with shops throughout the capital handing out IOUs and candy in lieu of change after they ran out of low denomination bank notes.
Old notes became obsolete at the close of trading Monday, and a new range of bills _ with three zeros struck off the old denominations _ replaced them. The government said the changeover was meant to curb inflation and rein in burgeoning money laundering and illegal black marketeering.
Some stores asked customers to make up their change with additional purchases of chocolate and candy displayed at checkout cash registers or accept IOU slips that were rubber stamped and signed by store managers for authenticity.
State-run power, water, telephone and other utilities also told cash-paying account holders that their next bill would be credited with the outstanding balance. There were also reports of problems on buses and trains.
Stores and businesses said they had not received enough new notes in small denominations to tender change in amounts lower than 500 Zimbabwe dollars _ about $2.
A regular loaf of bread cost up to 200 new Zimbabwe dollars and many customers, also short of new small denomination notes, proffered 500 Zimbabwe dollars for a single loaf. Some opted to buy two loaves and make up the difference with single pieces of candy, boxes of matches or small items they neither needed nor wanted, store managers said.
There were no reports of police needing to be called in to quell angered shoppers.
Gideon Gono, governor of the state central bank and architect of the changeover, was out of the country on a trade and investment trip to China and was not available for comment on the shortages.
Customers formed long lines at banks and ATMs Tuesday to draw new notes from personal accounts.
Over the weekend, stores and supermarkets reported a surge in last-minute buying of groceries and other goods to get rid of old notes.
Zimbabwe's economy has been in free fall since February 2000 when the government began seizing thousands of white-owned commercial farms for redistribution to blacks, crippling the key agriculture sector.
As the economy has plummeted, government services have declined and millions have become dependent on aid.