Jonanthan Clayton
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Zimbabwe, gripped by rampant hyper-inflation stoked by ruinous economic policies, reacted by knocking ten zeros off the country’s near-valueless currency.
The move by the Reserve Bank, which analysts said would do nothing to redress the economic crisis, turned ten billion dollars in to one dollar. It came as President Mugabe went on state television and threatened to impose a state of emergency if businesses took advantage of the country’s economic woes, which he blames on the limited sanctions imposed by the West.
Mr Mugabe, 84, often accuses Western capitalists for the country’s plight, but this time his words, coinciding with a breakdown in talks with the opposition in neighbouring South Africa on a government of national unity, were taken more seriously.
An African diplomatic source close to the talks, which began at a secret location in Pretoria last week, said: “If he feels the talks are not going his way, he could well use the economy as an excuse for a state of emergency and try and cling on a little longer."
President Mbeki of South African flew to Harare yesterday to see Mr Mugabe after having previously met Morgan Tsvangirai, the leader of the main opposition Movement for Democratic Change (MDC). He later said that the talks would resume on Sunday.
It is believed they stalled after Mr Mugabe offered the MDC leader only a few minor ministries and the meaningless position of third deputy president — a new post. The MDC claims that it won the first round of the country’s election on March 29, but then Mr Mugabe unleashed a campaign of intimidation to win a second round which the opposition boycotted.
Mr Mugabe would remain as president for two years and then step down, but the opposition fears the ruling ZANU (PF) party would use the period to undermine the MDC still further and ensure one of its top politburo figures takes over.
In his television statement, Mr Mugabe insisted that he was negotiating in good faith. “We are still negotiating, we want to succeed...You find room for compromise but sometimes compromise is difficult ... So things are never easy.” An official South African statement said that Mr Mbeki would also meet the leader of a breakaway opposition faction, Arthur Mutambara.
Mr Mugabe and Mr Tsvangirai, who is also under pressure from his grassroots not to make too many concessions, met for the first time in ten years last week and agreed to have their negotiators hammer out a formula to share power.
All sides are under immense regional pressure to do a deal. Zimbabwe’s neighbours, all awash with hundreds of thousands of refugees, have lost patience with Harare, but remain deeply suspicious of the MDC and its leader.
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First of all fix the government and the inflation will not haunt everyone. Gideon Gono never learns.
calvin, milton keynes, uk
"Zimbabwes neighbours....remain deeply suspicious of the MDC and its leader."
All they must do is ensure that there is a free, fair election and make it clear that they won't tolerate any rerun of Mugabe's antics. Then, if the MDC are no good, they can be voted out. That's how democracy works
David Ashton, Bathurst, Australia
Mugabe must just step down, we are sick and tired of him and his old guards. They must respect the will of the people. It is an insult to offer Morgan Tsvangirai third vice president's post when he commands the most support in Zimbabwe. I am a Zimbabwean and I know whats happening there.
SamMao, Johannesburg, South Africa
It is a learning curve.Quite a long one it seems....
Mark Simpson, London, UK
What do they complain about! They are all billionaires now!
Boris, Arles, France
Zim should invest in a good money printing machine
derek, Durham, uk
Too much outside interference in Zims affairs. If Zims want to slash their zeroes, let it be. Which banking system can cope with that amount of zeroes? What of the practicality of carrying around bundles of currency? Zim economy will be turned around one day. Have sanctions also played a role?
Davis, Manchester,
Whether you like it or not, Zimbabwe and its people were 1000 times better off as a colony than being totally destroyed by Mugabe and his henchmen.
I don't think anyone can seriously deny this, even if it is "politically incorrect" and inconvenient.
Cliff, Chonburi, Thailand
The only way out of this is to fix the price of more than 50% of goods, nationalise food and clothing production and sales. A few leanings towards communist principles for a few years will fix this. It cant get much worse can it?
Nayth Ona, Manchester, UK
john did you really want Zimbabwe to remain a colony forever????
temba, edinburgh, uk
I do'nt see how Zanu PF government can continue to rig and fix their currency. Surely it is valued at zero and not worth even the paper it is printed on. There has never been a government like this one. They cannot carry on without any income at all. Who is giving them bank credit? China? Barclays?
Colin, Cambridge, United Kingdom
War Never Solved Anything In this World to date!!!!
In response to Lokesh, Delhi, India above "..if it means pumping in armed men.."
Zimbabweans don't need any war in our country neither do we foreign people advocating a war. Leave the negotiations to take their course. Give us space.
K Patel, Hre, Zimbabwe
They wanted Independence and voted in Mugabe not us so it's a problem of their own making
John, Salford, England
They are not addressing the core issue of their system going down the drain.
If zimbabweans cannot fix it, then UN needs to step in and save this country from anarchy. If it means pumping in armed men, material, money then so be it.
But we need to save the millions who live in zimbabwe.
Lokesh, Delhi, India
Slashing of zeros is not the solution Gono.The biggest zeros to be slashed is Mugabe and Msika.
We are tired of carrying useless notes everyday and more so we are charged rents and other bills in forex and to add matters worse we are paid our salaries in Zim Rubish dollars.
Themba , Bulawayo, Zimbabwe
Sounds like they are making it up as they go along, Maybe if we all write a letter to our bank we should ask them to make £1 equal to a hundred ...... : ) sorted !!!!!
Paulie, Northamptonshire, UK
Maybe, instead of slashing 10 zeros of their currency, they should slash Mugabe and 10 of his cronies from government?
Neil, London,
this does not make any sense at all!!!!! they are some who dont even make 400 bln a month, they just need to scrap it all together and use us dollars until mugabe is dead.
john mudapakati, harare, usa
This can only mean one thing Zimbabweans must excel at math. And that's just to keep track of the daily fluctuations.
Peter, Vancouver BC., Canada
Not a clue... they will carry on printing money like mad, and the zeros will soon be back.
Rod Baker, Cape Town, South Africa