NewsSouthern AfricaZimbabwe: Fears over introduction of new bond notes trigger panic buying, hoarding

Thu,23Nov2017

Posted on Monday, 06 June 2016 12:46

Zimbabwe: Fears over introduction of new bond notes trigger panic buying, hoarding

By Nqobile Bhebhe

Some fear the cash crisis might result in serious food shortages like what happened at the height of Zimbabwe's economic collapse between 2007 and 2008. Photo©AP/SIPACrippling cash shortages in Zimbabwe have triggered panic buying and hoarding of basic food commodities, as locals fear a return of shortages.

A snap survey in Zimbabwe's second city, Bulawayo revealed that some people are now hoarding basic commodities in anticipation of a looming food crisis, as the spectre of 2008, when shops ran out basics looms large.

It's chaotic. Right now, Zimbabweans are panicking over the introduction of the bond notes

The southern African nation faces a crippling cash shortage and the country says it will launch bond notes to mitigate the situations, but Zimbabweans are wary this is a precursor to the re-introduction of the local currency after it was discarded with inflation said to have reached 79 billion per cent.

Major retail outlets have resorted to restricting consumers to a maximum of two items per customer, with cooking oil, sugar and mealie-meal being the most affected.

Retailers fear that customers who buy in bulk will later resell the items on the black market.

A sceptical customer, Martin Ncube feels the cash crisis might result in serious food shortages almost like what Zimbabweans witnessed at the height of the nation's economic collapse between 2007 and 2008.

At the height of the previous food shortages, shoppers cleared out supermarkets, leaving shelves bare of essential items.

"It's chaotic. Right now, Zimbabweans are panicking over the introduction of the bond notes, which are due to come in October. It is prudent to stock food supplies," Ncube said.

However, economist Prosper Chitambara allayed fears that the shortages would lead to a repeat of the 2008 situation where the market ran out of basic commodities.

"I do not think we will have a repeat of the 2008 situation because we are using the United States dollar, which is different from what we were using at that time," he said.

But to compound the situation, importers especially retailers, are fretting over delays in processing telegraphic transfers for cross border suppliers, which, they fear, will seriously affect their ability to buy and supply the local market with critical goods and services.

A telegraphic transfer is an electronic method of transferring funds that is used primarily for international transactions.



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