Bulawayo runs out of cash
By Tichaona Sibanda
1 June 2007

The country’s second largest city Bulawayo has run out of cash as the economy rushes towards total collapse. Government mismanagement has plunged the nation into a hyperinflationary spiral, bringing the economy to its knees.

ZAPU President Paul Siwela told us he went to two separate banks in the city and was told there was no cash to dispense. He believes stringent banking regulations have discouraged a lot of people from depositing their money into banks.

Currently a corporate account holder is only allowed to withdraw Z$3 million. This means a company can only access the equivalent of US$30 a day, making it impossible to keep a business running or to pay wages. Individual account holders can withdraw Z$1,5 million a day. Siwela said such a scenario forces people to think twice before taking their money to the bank because of the restrictions they face when they want to withdraw part of the money.

He said this has precipitated a situation where money was no longer circulating within the financial or banking systems.

‘How can people run businesses on US$60 a day. It means people don’t see the reason why they should bank their money and be restricted to withdraw Z$3 or Z$1,5 million,’ Siwela said.

The dramatically accelerating crisis has forced many companies to shut down countrywide and prices are doubling on a weekly or even a daily basis just as the nation also struggles with a drought.

‘One does wonder how much longer can the economy be allowed to collapse, because we now have a mafia running the country and not a government,’ said Siwela.