Shopping spree as Zimbabwe currency loses three zeroes

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The Independent Online

Nervous Zimbabweans have gone on a reluctant shopping spree ahead of the phasing out of the nation's old bank notes tomorrow.

Consumers have stocked up on bulk goods - from coffee to toilet paper - and the wealthier splurged on new cell phones, clothing, and household and electronic items, shop owners said on Friday.

The change to a new range of notes comes after the central bank struck three zeros off the old notes in the hyperinflating economy and, earlier this month, began issuing the new denominations that include paper notes for cents, a rarity in world currencies. Many Zimbabweans were left with old notes they were unable to exchange. Those notes are set to become obsolete at the close of business on Monday.

Businessman John Letherby bought 10 bottles of whiskey at his local liquor store in the Newlands suburb of Harare. "I have already changed my limit into new notes. I will have to look at the Scotch as an investment," he said.

With record inflation at nearly 1,000 per cent, the highest rate in the world, the price of whisky and other imported luxuries has more than doubled in the past two months.

Under the changeover rules, individuals are permitted to exchange a limit of 100 million old Zimbabwe dollars for new currency in a single transaction each week since 1 August.

Those carrying or attempting to exchange more than 100 million Zimbabwe dollars are required to prove they earned or received the money legally. Businesses were allowed to exchange 5 billion Zimbabwe dollars a week in old bills in what the central bank said were measures to prevent burgeoning money laundering.