The Zimbabwe dollar (sign: $, or Z $ to distinguish it from other dollar denominated currency) is the official currency of Zimbabwe from 1980 to 12 April 2009. During this time, it is subject to the above inflation period on average, followed by a period of hyperinflation.
The Zimbabwean dollar was introduced in 1980 to replace the Rhodesian dollar directly in par (1: 1), with the same value as the US dollar. Over time, hyperinflation in Zimbabwe reduced the Zimbabwean dollar to one of the lowest-priced currencies in the world. It was refracted three times (in 2006, 2008 and 2009), with denominations up to $ 100 trillion in banknotes issued. The final redenomination yields a "fourth dollar" (ZWL), which is worth 10 25 ZWD (first dollar).
The use of the Zimbabwean dollar as the official currency was effectively abandoned on April 12, 2009. It was raised in 2015, with remarkable accounts can be renamed until April 30, 2016. In place of Zimbabwean dollars, currencies include South African rand, Botswana too, pound sterling, Indian rupee, euro, Japanese yen, Australian dollar, Chinese yuan, and United States dollar are now regularly used.
Video Zimbabwean dollar
Origin
The predecessor of the Zimbabwean dollar, the Rhodesian dollar, is essentially equal to half of the pound sterling value at the time it was adopted (during 1970 decimation). The same practice is used in other Commonwealth countries such as South Africa, Australia and New Zealand. The name selection was motivated by the fact that the reduced value of the new unit was correlated more closely to the US dollar than it did in the pound sterling.
Design
The main illustration on the front of all the banknotes is Chiremba Balancing Rocks at Epworth, Harare, which is used as a metaphor that shows the importance of balancing the development and preservation of fragile environments. The reverse side of the dollar notes often portrays Zimbabwean culture or landmarks.
Maps Zimbabwean dollar
History
Initial introduction (ZWD)
The first Zimbabwean dollar was introduced in 1980 and replaced the Rhodesian dollar at par. The initial ISO 4217 code is ZWD . At the time of its introduction, the Zimbabwean dollar is worth more than US dollars in the official exchange market, with 1 ZWD = 1.47 USD, although this does not reflect actual purchasing power held. As a result, both on the official and parallel markets, the value of the currency eroded rapidly over the years, and in July 2006, the Zimbabwe dollar parallel market value fell to Z $ 1,000,000 = GB $ 1.
First First denominization (ZWN)
In October 2005, the head of the Reserve Bank of Zimbabwe, Dr. Gideon Gono, announced that Zimbabwe will have a new currency the following year, and new banknotes and coins will be produced. However, in June 2006, it was determined that, for a new, viable currency, Zimbabwe must first achieve macroeconomic stability (ie, double-digit inflation). On the contrary, in August 2006, the first dollar was denominated to the second dollar at the first 1000 dollar rate to 1 dollar (1000: 1). At the same time, the currency was devalued against the US dollar, from the first 101,000 dollars (101 once revalued) to 250 dollars a second, a decrease of about 60% (see table of exchange rate histories below). ISO originally assigned a new currency code ZWN to this denominated currency, but the Reserve Bank of Zimbabwe can not handle currency changes, so the currency code remains 'ZWD'. The revaluation campaign, which Gideon Gono named "Sunrise Operation", finished on August 21, 2006. It is estimated that about ten trillion Zimbabwean dollars (22% of the money supply) are not redeemed during this period.
The following year, on February 2, 2007, the RBZ revealed that a new (third) dollar would be released. However, with inflation still exceeding 1000%, paper money is kept in storage. During the same month, the Reserve Bank of Zimbabwe declared illegal inflation, banning certain commodity price increases between 1 March and 30 June 2007. Officials arrested executives from several Zimbabwean companies due to price increases on their products, and economists reported that "chaos has begun to rule and people in the public sector are panicking ". On September 6, 2007, the Zimbabwean dollar was re-evaluated by 92%, creating an official ZW exchange rate of ZW $ 30,000 to US $ 1, although the black market exchange rate is estimated at $ 600,000 to US $ 1.
As the official exchange rate became more unreliable, the WM/Reuters company introduced a notional exchange rate (ISO ZWN) based on Purchasing Power Parity utilizing a dual list of companies in Harare (ZH) and London Stock Exchange (LN) stock exchange.
Second Second Re-denomination (ZWR)
As of July 30, 2008, the dollar was re-denominated. After August 1, 2008, ZW $ 10 billion is worth ZW $ 1. The new currency code is ZWR . Denominations to be issued are coins worth Z $ 5, Z $ 10 and Z $ 25, and notes worth Z $ 5, Z $ 10, Z $ 20, Z $ 100, and Z $ 500. Due to the frequent lack of cash and Zimbabwe's seemingly worthless dollar, foreign currency was effectively passed as de facto currency on 13 September 2008 through a special program. The program formally allows a number of retailers to receive foreign money. This reflects the reality of economic dolatan, with many shopkeepers refusing to accept Zimbabwean dollars and asking for US dollars or South African Rand instead. Despite redenomination, the RBZ was forced to print higher-priced banknotes to keep pace with inflation, with ten zeros reappearing by the end of 2008.
Third re-denomination (ZWL)
On February 2, 2009, the RBZ announced that 12 further zeroes had to be taken out of the currency, with 1,000,000,000,000 Zimbabwean dollars being third exchanged for a new fourth dollar. New banknotes were introduced with a nominal value of Z $ 1, Z $ 5, Z $ 10, Z $ 20, Z $ 50, Z $ 100, and Z $ 500. The fourth dollar bill circulated side by side with the third dollar, payment valid until 30 June 2009. The new ISO currency code is ZWL.
Despite the introduction of the fourth dollar, the problem is not eliminated, and the economy continues almost completely dollarised. In his first budget, Zimbabwean finance minister Tendai Biti declared that "Zimbabwean dollar death is a reality we must face." Since October 2008, our national currency has become almost dead. In late January 2009, acting Finance Minister Patrick Chinamasa announced that all Zimbabweans would be allowed to do business with any currency, in response to the hyperinflation crisis. On April 12, 2009, the media reported that economic planning minister Elton Mangoma had announced the suspension of local currency "for at least a year", effectively ending the fourth dollar.
Withdrawal
Hyperinflation
The four issues of the Zimbabwean dollar are experiencing high levels of inflation, although only in the early 2000s Zimbabwe started experiencing a completely unsustainable hyperinflation.
On July 13, 2007, the Zimbabwean government said it has temporarily suspended inflation figures (official), a move that analysts say is intended to draw attention from "runaway inflation coming to symbolize an unprecedented economic crisis in the country". In 2008, the rate of inflation accelerated dramatically, from levels in January of over 100,000% to an estimated level of more than one million per cent in May, and nearly 250 million in July. As predicted by the quantity theory of money, this hyperinflation is associated with the choice of the Reserve Bank of Zimbabwe to mushroom the money supply.
Money supply (2006-2008)
The Reserve Bank of Zimbabwe is responding to the declining value of the dollar by repeatedly arranging the printing of further banknotes, often at great expense from overseas suppliers.
On March 1, 2008, it was reported that documents obtained by The Sunday Times show that the Munich company Giesecke & amp; Devrient (G & D) receives over EUR500,000 (Ã, Â £ 382,000) a week to send banknotes equivalent to Z $ 170 trillion a week. By the end of 2008, inflation had risen so high that automatic teller machines for one large bank gave "data overflow errors" and stopped the customer's effort to withdraw the money with so much zero.
Disapprovement and demonization
The use of foreign currency was legalized in January 2009, causing general consumer prices to stabilize again after years of hyperinflation and price speculation. This move led to a sharp decline in the use of the Zimbabwean dollar, as hyperinflation gave even the highest unworthy denominations. The Zimbabwean dollar was effectively abandoned as the official currency on April 12, 2009, when Economic Planning Minister Elton Mangoma confirmed the suspension of the national currency for at least a year.
On January 29, 2014, Zimbabwe's central bank announced that the US dollar, South African Rand, Botswana as well, Pounds Sterling, Euro, Australian dollar, Chinese yuan (renminbi), Indian rupee and Japanese yen will all be accepted as legal currency in the country.
In June 2015, the Reserve Bank of Zimbabwe began officially demonstrating the Zimbabwean dollar, formally valuing the zero fiat currency, to complete the transition to the US dollar at the end of September 2015. The Zimbabwean government declared that a $ 5 credit to a domestic bank account, with balances of up to 175 Zimbabwean quadrillion dollars, and that it would exchange Zimbabwean dollars for US dollars at a rate of 1 USD to 35 quadrillion Zimbabwe dollars into accounts with balances over the Quadrillion zillion dollars of Zimbabwe. This measure is intended to stabilize the economy and form a credible nominal anchor under low inflationary conditions. The exercise brings closure to the extraordinary issue on the Zimbabwean dollar, further confirming the government's position that local units will not return any time soon. The government has maintained that the Zimbabwe dollar refund will only be considered when major economic fundamentals, such as productivity in key sectors, have been achieved.
Coins
In 1980, coins were introduced in denominations of 1, 5, 10, 20, 50 cents, and 1 dollar. The 1-cent coin is struck with bronze, with the other being struck in cupro-nickel. In 1989, bronze-plated steel replaced bronze. A 2 dollar coin was introduced in 1997. In 2001, nickel-plated steel replaced cupro-nickel in 10, 20 and 50 cents and 1 dollar coin, and a 5 dollar bimetallic coin was introduced. The Reserve Bank of Zimbabwe announced plans to coin Z $ 5,000 and Z $ 10,000 in June 2005, although this never really happened.
In its mid-term monetary policy statement 2014, the Reserve Bank of Zimbabwe (RBZ) said it will import a special coin, known as Zimbabwe's bond coins, to reduce shortages in the economy. Like the original 1980 coins, this particular coin will be denominated in 1, 5, 10, 20, and 50 cents, but will have a value equal to US cents. There will also be South African rand coins 10 cents, 20 cents, 50 cents, 1 rand, 2 rands, and 5 rands. The RBZ statement does not mention when or where these coins will be imported, but a further report on November 26, 2014 explains that more than $ 40 million of these coins are expected to be delivered within the next week from Pretoria. On December 18, 2014, denominations of 1, 5, 10, and 25 US cents were released into circulation. The 50-US denomination was followed in March 2015. A 1-dollar bond coin was released in November 2016.
Banknote and check
Zimbabwe dollar banknotes were issued by the Reserve Bank of Zimbabwe from 1980 to 2009. Until 2003, regular banknotes were issued, but when hyperinflation developed from 2003, the Reserve Bank issued short-term emergency travel checks.
Exchange rate history
This table shows a brief history of the foreign exchange rates of the Zimbabwean Dollar to one US Dollar:
Due to the lack of banknotes in December 2007, funds transferred through Electronic Funds Transfer Systems (EFTS) charged a premium rate of about $ 4 million, while the cash transaction rate varied around $ 2 million.
? The exchange rate is 20,000,000 for a large sum.
The third dollar exchange rate above is OMIR. The cash rate differs significantly from the rates above. The table below is the cash rate from the history of the third dollar:
Initial devaluation
The first dollar devalued from 0.6788 R $ to 1 US $ in 1978 to about half a million per US $ in 2006, when the currency was reassessed.
This table shows more details of the historical value of one US dollar in Zimbabwean dollars:
Second devaluation
The second dollar starts on August 1, 2006 with an official rate of 250 and a parallel rate of 550 to US $. In July 2008, the dollar was revalued, this time $ 10,000,000,000 to 1 $ 3, after a parallel rate of $ 500 billion to $ 1.
More detailed data can be found in the table below:
Restoration of market data
In the final months before Zimbabwe's central bank reform 30 April 2008, almost all popular currency conversion sources rely on the official rate of 30,000 ZWD to 1 USD for published figures, regardless of the large difference between it and the free market rate. On May 23, 2008, Bloomberg and Oanda began issuing floating rates based on the domestic market of regulated formal banks by Zimbabwe, while Yahoo Finance began using the official rate that was updated in July, albeit with a decimal point change of 6 places. The reported rates generally reflect the Official Tariff as shown in the table above. They soon begin to differ, in the overexception of the Zimbabwean dollar, substantially compared to the less-organized markets such as offshore markets or freely traded paper money on the streets of Harare, reflected above as Parallel Tariffs.
Third devaluation
On August 1, 2008, ten zeros were removed from the currency, reducing Zibbons 10 billion dollars into one dollar. On October 3, 2008, the Reserve Bank of Zimbabwe temporarily suspended the Real Time Gross Settlement (RTGS) system, halting the electronic parallel market transfer, but was restored on November 13, 2008.
After its introduction on August 1, 2008, the third dollar continued to weaken.
An overview of exchange rate data can be found in the table below:
Devaluation end
On February 2, 2009, the RBZ removed 12 zeros from the currency, with 1,000,000,000,000 (third) Zimbabwean dollars converted for 1 new dollar (fourth). Although the dollar was abandoned on April 12, 2009, the exchange rate was maintained at intervals for several months. Therefore, the fourth dollar will be worth $ 200,000,000,000,000,000,000,000,000,000,000,000, or 2ÃÆ'â € "10 35 first dollar if it is never assessed again.
On June 4, 2015, it was announced that the Reserve Bank of Zimbabwe would exchange some old paper money for the US dollar.
See also
- Hung Hung Hung?
- Hyperinflation in Zimbabwe
- Zimbabwe bond note/coin
- Zimbabwe Banknotes
- Zimbabwean Economy
- Redenomination
- Hyperinflation
Note
References
Further reading
Source of the article : Wikipedia
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