As of four days ago Zimbabwe has its very own gold bullion coins, one troy ounce, 22 carat gold. Like gold coins sold all over the world it even has its own name, Mosi-oa-Tunya, which is the name the Tonga people gave the Victoria Falls and roughly translates to “The smoke that thunders”. Unlike gold coins elsewhere nobody has any idea if it will be tradable outside the country and therein lies the catch.
The coin has been introduced to try and rescue the local Zimbabwe dollar from oblivion. Nobody wants it and on the parallel market it’s trading at 720 to one US dollar though for some reason now outlets I spoke to yesterday were using less than 760. That is actually down from 750 a week ago when I had to sell 1,000 US dollars to part-fund my staff wages. Not many retailers are using the local dollar anymore and, although they are bound by law to accept Zimbabwe dollars, they price goods so that it’s very attractive to pay in $US. Supermarkets are the lone exception and they price at the official rate of 400 or so to the US dollar. Those who can obviously pay for their groceries and consumables in the local currency.
The initial run of gold coins will number 2,000 and will be sold at around US$1,800 or so depending on the value of the metal. One can also pay in any other major currency and, here’s the kicker, Zimbabwe dollars at the official rate! Yes, this means that if you can get enough local dollars you can get yourself a gold coin or several very cheaply indeed. The government admits that this price is out of consideration for most people, so will consider minting smaller coins at a later stage.
Cynics are easily found in Zimbabwe and it’s not difficult to see why. Many have pointed out that these coins are there purely for the rich and politically connected to mop up easily and hopefully in the process rescue the local dollar (the price is way beyond the average citizen intent on daily survival). I suggested to my cousin, who is a gold smith in Cape Town, that she should see if she could get her brother, who lives in Harare, to buy her some that she could then melt down for use in her business. Gold jewellery is usually diluted with silver to around nine carats. It would be really worthwhile doing if possible. My local cousin is well-connected but probably not that well connected.
It has not of course escaped notice that Zimbabwe does not have a great reputation for fiscal responsibility and those who do buy the coins might well find out that nobody outside the country is interested in buying them. Why should they when in South Africa, our neighbour, one can buy the internationally recognized gold Krugerrand not to mention the plethora of other coins available worldwide?
It doesn’t take a huge amount of mathematical intellect to work out that gold coin sales are unlikely to make much difference to Zimbabwe’s dire financial status. Let’s have a look:
Initial minting is 2,000 coins valued at $1,800 each. That’s a grand total of $3.6 million. Not a lot to get excited about. This has not stopped the government owned newspaper The Herald from waxing lyrical and claiming that that existing stocks of the coins have already sold out. How many were available in the first place was not mentioned. Perhaps even more tellingly the article claims that the gold coins will take local currency out of circulation. Does this mean that we are reverting to using the US dollar once again?
Zimbabwe Absurdity 
The curse of good health
13 08 2015My uncle turns 93 or maybe it’s 92 this year. Mentally he’s very sharp but physically he’s frail. Last year he decided he’d had enough of life and decided to end it on his terms. He failed and now he’s condemned to a old age home in rural England, waiting to serve his time amongst the old, frail and demented.
I went to visit him the week before last whilst on an infrequent trip to a family gathering and the wedding of a young friend. We don’t get together much; my brother lives in the UK, my sister in north-western USA and I’m in Zimbabwe. It was my brother’s 60th birthday last weekend and I’d said to my sister-in-law that I’d come over for it if he promised to have a party.
Lucy and Will’s big day
It was pure luck that Lucy was getting married the weekend before and well, I probably won’t see Ant again.
The UK is unlike Zimbabwe in many ways;
Clean
Organised
Good roads
Horrendously heavy traffic but a noticeable absence of bad drivers (ok so it wasn’t a dangerous breach but it’s still a red light!)
Crowded
Green (Zim is very dry right now
In short – First World!
So whilst in London we did the tourist thing, the Science Museum to get my dose of science.
Tower Bridge on the Thames
Dining hall at the old Naval Academy.
The Cutty Sark
A Thames river cruise to the Cutty Sark and checked out the amazing dining hall at the old Naval Academy. Zimbabwe does not have recorded history going back that far and we don’t have a navy either. We do however have better weather than the UK though on this trip it wasn’t bad, choosing to rain just when I chose to do some serious photography.
Getting back to Harare we encountered some decidedly Third World air service with all the luggage being left in Johannesburg because there was no Jet A1 fuel in Harare. Well, that was the official story. It is certainly symptomatic of the state of the economy here and meant that we had to go back to the airport the next day to collect our luggage (don’t they deliver it elsewhere?). So my Saturday visit to the Gallery Delta had to wait a week.
The current exhibition there is From Line to Form where Wallen Mapondera’s string picture Everyone is a Vendor neatly caught the dire state of the economy; we just don’t produce much anymore.
Everyone is a vendor
Not at all like the market we visited in the curiously named Bury St Edmond where it was very hip to buy local produce. Not sure if these tomatoes were local but they are certainly better quality than the ones we get here!
Good quality produce
When I left Ant I shook his hand. His grip was firm by any standard. He just laughed when I mentioned it. Handshake strength is one of the criteria used to asses old people’s health. I winced inwardly at the irony of it.
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Tags: Bury St Edmund, Cutty Sark, London, Naval Academy, River Thames, Tower Bridge, Zimbabwe economy
Categories : Social commentary, Travel