Zimbabwe intends to issue new dollar-denominated “bond notes”

According to a press release dated 4 May 2016, the Reserve Bank of Zimbabwe, blaming a cash shortage of US dollars on the strength of the US dollar, intends to convert all USD exchange receipts into South African rand and euros in an effort to “spread the demand for cash amongst a wide range of currencies and in order to mitigate against concentration risk.”

Furthermore, “In order to mitigate against possible abuses of this [USD200 million foreign exchange and export incentive facility] through capital flight, this facility shall be granted to qualifying foreign exchange earners in bond coins and notes which shall continue to operate alongside the currencies within the multi-currency system and at par with the USD. The Zimbabwe Bond Notes of denominations of $2, $5, $10 and $20 shall, therefore be introduced in future, as an extension of the current family of bond coins for ease of portability in view of the size of the USD200 million backed facility.”

Courtesy of Aidan Work.

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