Zimbabwe unveils new bank note

Zimbabwe’s central bank today unveiled a new bank note that was double the face value of the inflation-wracked nation’s largest note at 100,000 Zimbabwe dollars – and worth less than 75c.

The new note goes into circulation tomorrow, the Reserve Bank said.

With official inflation running at 1,043%, the highest in the world, the note is slightly more than enough to buy a price-controlled loaf of bread or a copy of the state newspaper.

The central bank said higher denominations may be introduced later.

A 50,000 Zimbabwe dollar note was introduced four months ago. Coinage has long disappeared.

The troubled southern African nation faced its worst economic crisis since independence from Britain in 1980.

The official poverty line for the basic monthly needs of an average family of five rose to an income of 41 million Zimbabwe dollars (€315) earlier this month, making even the most impoverished Zimbabweans multimillionaires in local currency terms.

An estimated 80% of the 12.5 million people are living far below the poverty line.

Economic meltdown has largely been blamed on disruptions to the agriculture-based economy since the often violent seizures of thousands of white-owned commercial farms began in 2000 to transfer land to blacks.

Acute shortages of food, hard currency, gasoline and imports, along with regular power and water outages, have crippled production in the former regional breadbasket and exports have dwindled.

On Monday the price of scarce petrol rose by one third, t the equivalent of about €10 a gallon, at the official exchange rate.

Business at the Harare Stock Exchange, shut down last week, remained suspended today in a dispute with tax authorities, leading to massive losses on stock trading, officials at the local bourse said.

The Zimbabwe Revenue Authority said in a statement today brokers boycotted the stock exchange after being ordered to pay value added tax on their commissions.

It said brokers could appeal to the Fiscal Appeals Court but should resume trading and pay about 15% tax in the meantime.

Brokers argue the nation’s tax legislation exempts them from VAT, and say paying the levy would force many out of business. The revenue authority said it would not back down.