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Zimbabwe Sanctions Use of Chinese Yuan as Official Currency, come Jan 1, 2017

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Thursday, November 03, 2016 11.27AM / WSJ / Agency News

Come January 1, 2017, the Chinese Yuan will become an official currency in Zimbabwe following discussions held between the two governments during the state visit of the Chinese president.

This will make the Chinese currency at par in Zimbabwe with the US Dollar, the South African Rand and the Botswana Pula with the Euro playing no role in this equation, perhaps a sharpish reminder of the negativity the European Union has shown against Zimbabwe.

China has become Zimbabwe’s largest trading partner and investments are expanding, following President Xi JinPing visit to the country some time ago.

 

It must be said that the situation in this country is special. He has no national currency since 2009. The failed land reform President-dictator Robert Mugabe has led to a severe economic crisis that the government tried to stop cranking printing money. Result: hyperinflation than 500,000,000,000% according to the IMF. In 2009, the face value of the last break of the Zimbabwean dollar circulated by the national bank of the country had reached a surreal level: 100.000 billion!

 

Looking East, after the windows to the West were locked by the Western powers, has become the remaining avenue to Zimbabwe, besides intra-African trade, to export and import goods and the use of the Yuan is expected to facilitate this further. A write-off of loans worth $40 million equally Zimbabwe at the time to find a sound economic footing again.

 

Chinese tourist numbers too are growing as they are for Zambia and other neighbouring countries; as Emirates becomes one of the few airlines, besides Kenya Airways, offering daily connections from a number of Chinese cities via Dubai to Harare.


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