Thursday, August 03, 2006

Zimbabwe's Currency

Photo courtesy of BBC News

This week, the Zimbabwe Central Bank dropped three zeros from the country’s currency in an effort to fight inflation. Banks had been struggling to keep up with sums regularly in the trillions and often in the quadrillions. Individuals, too, had to cope with the highly devalued currency by carrying suitcases full of bills to make even small purchases.

The inflation has had a profound effect on Zimbabwe residents. Those who had lived comfortably are now struggling to meet even their most basic needs. Now is the time when ASAP Africa’s projects are more necessary than ever. By providing individuals and communities with skills, training, and knowledge, we are helping them to become self-sufficient no matter what is happening in the rest of the country.

As Causemore Samanga, a Kufusa Mari Senior Field Officer, reports, the Kufusa Mari project is even more important now because it teaches people how to pool their money and generate their own income with a self-funded micro-finance methodology. The project participants are inspirational in how they apply what they have learned and then innovate beyond their training to cope with the changing crisis in Zimbabwe.

For example, the Nyajezi cluster has responded to the growing economic crisis by going beyond their normal function and forming a cluster fund, which is headed by a cluster committee chairperson and a committee. The fund is made up of penalties from late comers and money left over at functions such as field days. The money is lent to clubs at 15% and the club lends it to its members at 20%, payable at the end of the month. The functions of the cluster fund are like the way the national reserve bank functions. In this way, the community is creating its own financial infrastructure, within the unstable Zimbabwe economy.

The clusters’ innovations are encouraging, but the national economy remains bleak. Please take a few minutes to read more about what is happening in Zimbabwe’s economy.

Interactive Graphic Demonstrating what a Zimbabwean Dollar will Buy
Zimbabwe eliminates 3 zeros from its Currency
Mass Confusion as Zimbabweans Exchange their Notes
More Confusion

-Causemore Samanga and Stephanie Marienau

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