Zimbabwe has begun printing new notes in $10 and $20 denominations at a time when annual inflation stands at 926%, according to a state media report.
Citing Reserve Bank of Zimbabwe (RBZ) monetary policy committee member Eddie Cross, the Sunday Mail report said the decision was “imminent” to increase liquidity in the market.
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“The plans are advanced and higher denomination notes will be made available to the public sometime later this month. The Reserve Bank will make the announcement. They are being printed and the appropriate date will be announced soon,” Cross said.
He added: “We are moving cautiously because we don’t want to disturb the monetary balance and we are insisting that banks pay for the currency when they draw it so that there is no money creation.”
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The RBZ, like most of Zimbabwe’s public institutions, is faced with a bad transparency reputation. The first hint that the bank was already printing money was revealed in a social media video that went viral last week.
In the video a man suspected to be in his 20s is seen showing off bundles of packaged bank notes that have not been distributed. In a statement the bank said it was investigating the matter.
“The bank is offering a financial reward to the first person who will provide information leading to the positive identification and location of the man in the video,” the RBZ said.
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Last week, finance minister Mthuli Ncube hinted that government would be forced to print more money to raise the ZW$18bn bailout for industry because of the economic paralysis caused by the Covid-19 lockdown.
In April, Harare wrote to international finance institutions for a bailout, but nothing came out of it.
Only last week Zimbabwe was assured it would receive a US$7m World Bank bailout to fight the Covid-19 pandemic, despite being in arrears with the Washington-based lender.
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However, the US said there was need to carefully trace how the money would be used in Zimbabwe considering that there are high levels of corruption in handling public funds.
US chairman of the Senate foreign relations committee Senator Jim Risch said: “The US$7m World Bank grant for Zimbabwe reported today should come with strict transparency and accountability measures to ensure Zimbabweans receive services and support during Covid-19 and that these funds aren’t lost to ongoing mismanagement by the Zimbabwean government.”
Meanwhile, Mozambique received US$309m and Kenya got US$739m from the same fund.