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Just when you thought Zimbabwe's economy couldn't get any worse.
The Zimbabwean dollar has plummeted on foreign exchange markets. It takes almost a million dollars to buy one British pound.
Zimbabwe's currency was trading at £1 to 930 000 on the parallel market on Wednesday in what economists are predicting will be a catastrophic year for the country. Already the International Monetary Fund predicts inflation will reach 100 000 percent by the end of the year, while other experts say its already hovering at over 25 000 percent.
A "senior British diplomatic source" has told the Globe and Mail that Mugabe's price control scheme made a dreadful situation much worse. Not only are store shelves bare of essential commodities, even the black market is running out of goods.
"Mugabe's efforts at price control have not only backfired but they've exacerbated what is a fairly catastrophic situation anyway," said the source, who insisted on anonymity."It displaced retail activity into the black market, where there is no control, so inflation … is probably anywhere between 13,000 and 20,000 per cent," the source said.
. . .
The British diplomatic source . . . said that Mr. Mugabe's price-cutting attack "completely fractured the supply and production chains behind the retail sector, which were pretty fragile in any case. Companies have lost billions of Zimbabwean dollars and … even the black market is beginning to dry up.
The photo below shows a Zimbabwe restaurant patron paying for his meal. It cost Z$6 million, roughly equivalent to C$13.
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