President Mugabe has so far seen off his foes with a combination of violence, bribery and treachery. But there is one problem that is impervious to his usual strongarm tactics: Zimbabwe's decrepit economy.

The currency crashed unstoppably through a new low this week, passing 1 billion Zimbabwean dollars to £1, after the weekly Zimbabwe Independent quoted officials in the government statistics department as saying that inflation for the first three weeks in May was 1,700,000 per cent.

A fortnight ago the Central Bank introduced a Z$1 billion banknote, as well as a new species of notes called “special agrocheques” with a top denomination of Z$50 billion.

Since in 2006 the Central Bank removed three zeros from the currency, it means that the new note equals the Weimar Republic's highest note of 50 trillion marks, issued at the peak of its hyperinflation in 1924.

A pint of beer at Harare's cricket ground is Z$800 million. A 13-amp plug on Tuesday cost me Z$1.3 billion. Photocopying a two-page document came to Z$269 million. The Z$10 million note, introduced at the beginning of the year to reduce the snaking queues outside the banks, will not buy so much as a banana.

The Consumer Council of Zimbabwe estimates that next month the average family of six will need Z$350 billion to provide the basics for survival. This month the basket was Z$100 billion. “It is madness,” said Jeremiah Mawbe, a minibus driver. “I will never get that kind of money.”

Banks are struggling with the sheer volume of digits. A businessman supplied the Central Bank with stationery three weeks ago and invoiced it for Z$6 trillion. The bank sent the invoice back and asked for it to be broken down into three different invoices of equal amounts. “They said their computer software couldn't deal with so many zeroes,” the businessman said.

Worse is to come. On Wednesday the Government, which has banned the official issue of inflation figures, announced a pre-election sweetener that included boosting a modest fund meant to provide the extremely poor with medical attention, “from the current Z$20 trillion to Z$1.5 quadrillion”.

In November the annual budget for the entire Government, including the army, air force and police, was Z$7 quadrillion.

President Mugabe has an economics degree from the University of London, but appears oblivious to the fact that it is the relentless printing of money that is driving up prices and plunging the currency. He continues to claim, with increasing desperation, that the situation is “all part of a well-calculated regime-change agenda by the British”.

As the run-off on June 27 between Mr Mugabe and the opposition leader, Morgan Tsvangirai, comes closer, the need for paper money for the bankrupt Government will increase to astronomic proportions.

It needs to pay for a second election in three months, not just for the election infrastructure but also the costs of provisioning and paying thousands more militia members to subjugate the voters.

“They're printing money so fast but it's getting to the point that it's not fast enough,” John Robertson, a local economist, said. Even the state-run daily Herald newspaper reported this week that shopkeepers were charging up to 30 per cent commission to anyone paying with the Z$50 billion note. “This is not real money,” a cashier was quoted as saying.

This is alarming news for Mr Mugabe, who depends on a system of patronage paid to a vast network, from the machete-wielding militias to the Joint Operational Command, the committee of senior army, intelligence and police officers that direct the strategy for Mr Mugabe's political survival — and their own.

“The money is becoming valueless,” Mr Robertson said. “It won't be long before people start saying they don't want it, and I think it will start with the army. I won't be surprised if the generals are already saying, ‘We don't want that rubbish'.”

In June last year, the former American Ambassador, Christopher Dell, enraged the Government by forecasting that inflation would reach 1.5 million per cent by the end of 2007.

“It destabilises everything,” he said. “By carrying out economically destructive policies, the Mugabe Government is committing regime change on itself. The regime is reaching endgame.”

At the time, inflation was 4,500 per cent and the Zimbabwean dollar was 400,000 to the £. His forecast may have been precipitate, but not necessarily inaccurate.

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