The economic chaos engulfing Zimbabwe has turned even a mundane task such as renting a car into an unachievable dream for the average law-abiding citizen.
A car-rental company on Saturday quoted a day rate of Z$690 000 to hire a basic model, plus a deposit of Z$25-million. This is the equivalent of a staggering R19 600 per day — plus a deposit of R712 600 — at the official exchange rate, but only R250 and R8 900 respectively on the black market.
The figures provide an insight into the growth of the black-market economy in this once-prosperous Southern African nation, which is now reeling under hyperinflation of more than 1 700% and suffering from shortages of most basic goods. Most analysts predict inflation will soar even further this year.
The number of Zimbabwe dollars that bought a three-bedroom house with a swimming pool and tennis court in 1990 would today — at official exchange rates — buy a single brick. A lifetime public worker’s monthly pension cannot buy a loaf of bread.
The independent Consumer Council estimates regular supermarket goods increased in price by between 50% and 200% last month alone.
President Robert Mugabe blames sanctions, drought and former coloniser Britain for the collapse of an economy based on exports of agricultural and mineral products.
Others blame land grabs, in which Mugabe encouraged blacks to force out most of the 5 000 white commercial farmers who owned 40% of all agricultural land and produced 75% of agricultural output.
Zimbabwe’s main foreign-currency earnings comes from an estimated 3,5-million of its nationals living abroad, replacing tobacco exports, tourism and mining revenues slashed in six years of political and economic turmoil.
Zimbabweans abroad routinely send hard currency home to their families, much of it ending up on the black market — and giving even impoverished villagers the benefit of black-market deals, making most of the population lawbreakers, analysts say.
Currency violations carry the penalty of a fine or imprisonment in laws, which are invoked often but mainly by political and business rivals seeking to settle grudges.
Many Zimbabweans are prepared to run the risk, saying they have no choice considering the official rate of Z$250 to the United States dollar, and the black-market rate of Z$20 000 to the dollar.
For instance, a pack of six wax candles, traditionally used by the rural poor but now essential in urban homes during frequent power outages, sold for Z$47 000, which is R1 340 by the official rate and R16,80 at the unofficial one.
A regular can of soda on Saturday cost Z$10 000, or R285 at the official rate and R3,60 at the black-market rate. The store price of a bottle of imported Scotch whisky was about Z$500 000, or R14 250 officially and R178 by the black market.
A Zimbabwean motorist wanting to rent a car on Saturday was told that the Z$25-million deposit on a Volkswagen Chico was payable in cash — bundles of it — or a bank-certified cheque on a day banks were closed for Easter.
Even illegal money dealers are unlikely to raise that kind of money during the Easter break.
Automatic teller machines dispense a government-fixed maximum of Z$500 000 a day, or R14 250 officially and R178 on the black market, to each account holder.
”When we accept cash, it’s obviously coming from the black market. We don’t ask questions or we’d be out of business,” said an official of the rental company who asked not to be identified in case of investigation by central bank inspectors.
”Everyone does it. That’s the way it works,” he said. ”It doesn’t make any sense to change at the bank. Do you think our politicians do that?”
A foreign tourist could rent the Chico at the fixed, hard-currency cost for outside visitors of R185 a day and R2,50 a kilometre on Saturday.
If he bought a small, locally made chocolate Easter egg at Z$22 000 on his international credit card charged by law at the official rate, it would set him back $88.
But if he changed money on the street, making him a criminal too, he would get it for just over a single dollar. — Sapa-AP