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Zimbabwe dollar’s second death predicted

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BY RAY NDLOVU

When Zimbabwean businessman Nigel Chanakira asked 100 chief executive officers at a seminar in Harare on January 27 if they were willing to use the local currency, only one raised his hand.

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That reluctance is a stark demonstration of the government’s failure to win confidence in the Zimbabwe dollar, the reintroduction of which Finance minister Mthuli Ncube has staked the stagnating economy’s recovery on.

For the second time in two decades, Zimbabweans are abandoning their local currency.

At restaurants, a simple request for “the rate” sees one’s bill halved if it’s met in hard currency, and supermarkets openly offer discounts for goods purchased in United States dollars.

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The government paid public workers their Christmas bonuses in dollars, and the revenue service collects a third of its income in greenbacks.

“We can’t deny the reality,” Chanakira, the founder and former CEO of now-closed bank Kingdom Financial Holdings Ltd., said in an interview.

“When you get the Zimbabwe dollar you spend it quickly. No one wants to save in that currency.”

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Between 2009 and 2019, Zimbabwe’s economy was dollarised after hyperinflation led the government to print trillion-Zimbabwe dollar notes before abandoning its currency, leaving the country’s name synonymous with economic malfunction.

While the subsequent dollarisation tamed price growth, it hurt businesses as neighbouring countries using their own depreciating currencies undercut Zimbabwean manufacturers.

“Zimbabwe had become uncompetitive by 2013 and was burdened by an expensive workforce,” John Legat, CEO of the country’s oldest brokerage, Imara Asset Management Ltd., said in a note to clients.

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In February 2019, the government dropped a peg that kept a precursor of the Zimbabwe dollar at parity with the US dollar.

In June, it was rechristened the Zimbabwe dollar and use of foreign currency was briefly outlawed.

Today the currency trades at 115 to the greenback, and more than twice that on the black market.

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While inflation slowed from a 12-year high of 837 percent in July 2020, it was at 61 percent in January, still rapidly eroding the value of the local unit.

Officials including Ncube, a former Oxford University lecturer, and Reserve Bank of Zimbabwe Governor John Mangudya, said government policy is to stick with use of the Zimbabwean dollar.

“The country is not re-dollarising,” Mangudya said in a interview on January 17. “We need to find a home for our currency.”

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Ncube and his ministry didn’t respond to requests for comment.

Alois Burutsa, the lone defender of the Zimbabwe dollar at Chanakira’s meeting, said in an interview that “without our own currency, our exports become uncompetitive.”

He’s general manager of Buy Zimbabwe, an organisation that promotes local goods.

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Capitulation

Yet central bank figures show that 44 percent of transactions in the country are conducted in greenbacks.

The American currency is used to pay for everything from fuel to food, passports, medicines and school fees.

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Econet Wireless Zimbabwe Ltd., the country’s largest mobile phone operator, offers additional airtime and data if purchases are made in US dollars.

With the Zimbabwe dollar untradeable outside the country, companies need foreign currency to pay for imported equipment, consumer goods, and to placate an increasingly dissatisfied workforce.

And it’s not only businesses that are seeking alternatives to the local currency.

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The government itself is increasingly finding it has to pay in US dollars if it wants to get things done.

Already it’s told public workers that they’ll be paid partly in hard currency this year.

According to Imara, the brokerage, 45 percent of infrastructure contracts are being met in dollars.

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“Dollarisation is the ultimate outcome of a failed economic policy,” said Gift Mugano, executive director at Africa Economic Development Strategies, a Harare-based consultancy.

The Zimbabwe dollar “will be in the graveyard” by June, he predicted. Imara says it’ll be largely obsolete by the end of the year.

Chanakira was more optimistic: he said the currency could survive for another two years. – Bloomberg

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Zimbabwe moves to establish tough drug control agency amid rising substance abuse crisis

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BY NOKUTHABA DLAMINI

As Zimbabwe battles a surge in drug and substance abuse, the government has tabled a new Bill in Parliament seeking to establish a powerful agency to coordinate enforcement, rehabilitation, and prevention programmes across the country.

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The National Drug and Substance Abuse Control and Enforcement Agency Bill (H.B. 12, 2025) proposes the creation of a dedicated agency mandated to combat the supply and demand of illicit drugs, provide rehabilitation services, and strengthen coordination between law enforcement and social service institutions.

According to the explanatory memorandum of the Bill, the agency will operate under two main divisions — a Social Services Intervention Division to focus on prevention, treatment and community rehabilitation, and an Enforcement Division to target supply chains, trafficking networks, and related financial crimes.

The legislation describes drug abuse as “a grave internal national security threat” and “a public health crisis” that fuels organised crime, corruption and violence. It notes that drug profits have enabled criminal cartels to “purchase the instrumentalities of crime, including weapons,” and to corrupt both civilian and non-civilian public officials.

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Under the new framework, the agency will have powers to:

  • Investigate and arrest individuals involved in drug trafficking and production;
  • Work jointly with the Zimbabwe Republic Police, Zimbabwe Revenue Authority, and Medicines Control Authority of Zimbabwe;
  • Establish checkpoints at ports of entry and exit to intercept harmful substances; and
  • Expand the legal definition of “harmful drugs” to include emerging synthetic substances, in consultation with the Medicines Control Authority of Zimbabwe.

The Social Services Division will lead prevention campaigns, develop demand-reduction programmes, and facilitate the creation of rehabilitation and detoxification centres nationwide. It will also introduce a monitoring system requiring schools, employers, and local authorities to adopt anti-drug awareness and intervention programmes within 90 days of the Act’s commencement.

Each province and district will host offices of the agency to decentralise services and ensure community-level engagement, while traditional leaders will help devise local prevention strategies.

The Bill further empowers the agency to employ prosecutors from the National Prosecuting Authority to handle drug-related cases, signalling a shift toward specialised prosecution of narcotics offences. It also introduces a new, stricter “standard scale of fines” and penalties for drug crimes — higher than those prescribed under existing criminal laws.

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In a major development, the proposed law integrates the agency into Zimbabwe’s Money Laundering and Proceeds of Crime Act, allowing it to pursue unexplained wealth orders and seize assets linked to drug cartels.

The Bill stresses rehabilitation and social reintegration as key pillars. It obliges the agency to support affected individuals through psychosocial counselling, vocational training, and community wellness programmes aimed at helping addicts rebuild their lives.

If passed, the National Drug and Substance Abuse Control and Enforcement Agency will replace fragmented anti-drug efforts currently scattered across ministries and law enforcement agencies, creating a central authority to drive national strategy and coordination.

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Parliament is expected to debate the Bill in the coming weeks amid growing concern over youth addiction to crystal meth, cough syrups, and other illicit substances that have taken root in both urban and rural communities.

 

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Hwange unit 8 breaks down, deepening Zimbabwe’s power supply challenges

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BY WANDILE TSHUMA 

ZESA Holdings has announced that Hwange Unit 8 has been taken off the national grid following a technical fault, a development expected to worsen Zimbabwe’s persistent electricity shortages.

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In a statement released on Monday, the power utility said the unit would be out of service for ten days while restoration work is carried out.

“Hwange Unit 8 has been taken off the grid due to a technical fault. The unit will be out of service for 10 days while restoration work is carried out,” ZESA said.

The company said Hwange Unit 7 remains operational, generating 335 megawatts (MW) to support system stability, while power generation at Kariba South Power Station has been ramped up with “careful management of water allocations” to compensate for the temporary shortfall.

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ZESA apologized for the inconvenience and appealed for public understanding as engineers work to restore the unit.

Zimbabwe has faced recurring electricity supply challenges over the past two decades, driven by ageing infrastructure, limited generation capacity, and low water levels at Kariba Dam. While the commissioning of Hwange Units 7 and 8 in 2023 brought some relief, frequent breakdowns have continued to disrupt supply, forcing industries and households to endure prolonged load-shedding.

The latest fault at Hwange comes at a time when power demand is surging across the country, particularly during the hot season when air conditioning and irrigation systems increase pressure on the grid.

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Energy experts say the outage highlights the need for greater investment in maintenance, renewable energy, and grid modernization to stabilize Zimbabwe’s power supply in the long term.

 

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Tsholotsho to host national commemoration of International Day for Disaster Risk Reduction

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BY NOKUTHABA DLAMINI

Zimbabwe will on Thursday, this week,  join the rest of the world in commemorating the International Day for Disaster Risk Reduction (IDDR), with national events set to take place at Tshino Primary School in Ward 5, Tsholotsho District, along the Tsholotsho–Sipepa road.

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The global day, observed annually, aims to promote a culture of disaster risk awareness and highlight efforts to reduce vulnerability and build resilience in communities.

Speaking to VicFallsLive, Civil Protection Unit Director Nathan Nkomo said this year’s commemoration holds special significance for Tsholotsho, a district that has long struggled with recurrent flooding.

“The whole issue is to reduce, not to increase the occurrence of disasters. And by commemorating, that’s where we share ideas with other people,” Nkomo said.

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He noted that Tsholotsho’s selection as the national host was deliberate, following the successful relocation of families who were affected by flooding at the confluence of the Gwai and Shashani rivers.

“It’s not by accident that we are commemorating in Tsholotsho. We have built 305 houses for people who were affected in the Spepa area, and we will be celebrating in style because we have managed to relocate them,” he said.

“Now we no longer hear of people being flooded in Tsholotsho because of that relocation. So, we will be celebrating in style for Tshini and Sawudweni.”

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The relocations, carried out under government’s disaster recovery and housing programs, have been hailed as a success story in proactive disaster risk management.

Looking ahead to the cyclone season, Nkomo said funding remains the major challenge in preparedness and response.

“We cannot preempt to say there are challenges yet, but historically, since we’ve dealt with COVID-19 and Cyclone Idai, the issue of funds has always been critical,” he said.

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“This year, we are dealing with cyclones at a time when even our development partners have dwindling resources. So, funding will take centre stage in our deliberations, to see how best we can respond with the little we have. The whole idea, when you go to war, is not the question of numbers, but of strategy and how to win.”

The International Day for Disaster Risk Reduction is observed globally every October 13, but Zimbabwe’s national commemorations are being held later this year to align with local preparedness programs and community-based activities.

 

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