Zimbabweans will be able to trade in any currency they choose and the government will abandon price controls with immediate effect, acting finance minister Patrick Chinamasa said today.
Chinamasa told parliament that price controls would be abandoned because they had “unintentionally’’ harmed businesses and added to Zimbabwe’s hyperinflation. Zimbabweans will also be allowed to use “multiple currencies’’ for all business, including trading shares on the Harare-based Zimbabwe Stock Exchange, he said, presenting Zimbabwe’s national budget.
The country is in its 11th year of economic recession and has the world’s highest inflation rate, last estimated at 231 million percent in July 2008. It faces almost total collapse of its health, education, power and water facilities as Mugabe’s Zanu-PF and the Morgan Tsvangirai-led Movement for Democratic Change spar over the formation of a power sharing government.
Chinamasa gave a bleak picture of the southern African nation’s economy, saying, “It requires a paradigm shift in terms of acknowledging that we cannot eat what we do not have.”
Most businesses have abandoned the Zimbabwe dollar, which is in short supply because the central bank can’t print money fast enough to meet demand. Government employees will be paid allowances in vouchers which can be converted into foreign currency “in line with the expected improvement in foreign currency inflows,” Chinamasa said on state radio and television. The Zimbabwe dollar will not be abandoned. Instead it will operate alongside foreign currencies like the U.S. dollar and the South African rand, he said.
A corn and wheat monopoly held by the state-owned Grain Marketing Board will also be terminated, he said. Farmers and millers will be permitted to trade without state interference, with immediate effect.
Separately, the United Nations’ World Food Program today said that 6.9 million Zimbabweans out of the population’s estimated 11 million people require emergency food rations.