Zimbabwe offering 175 quadrillion local dollars for US $5

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HARARE: The Reserve Bank of Zimbabwe (RBZ) has set June 15 as the date for which demonetization of the Zimbabwe dollar begins, running until the end of September.

Zimbabwe introduced multiple currencies, mainly the U.S. dollar, South African rand and Botswana pula, to stem hyperinflation which, according to official figures stood at 231 million percent in 2008, although other quarters put it at over 4 billion percent.

The government dumped the local currency the Zimbabwean dollar in April 2009 but has not come up with a scheme to demonetize the currency until now, leaving Zimbabweans with stacks of useless notes stored at home or at their bank accounts.

According to the demonetization exercise, bank accounts with balances of zero to 175 quadrillion Zimbabwe dollars will be paid a flat 5 U.S. dollars, while those above 175 quadrillion dollars will be paid the equivalent value of 1 U.S. dollar to 35 quadrillion dollars (or 1 U.S. dollar to 35,000 dollars revalued).

The government said it had allocated 20 million U.S. dollars for the demonetization.

Many people have expressed joy at being given value for the Zimbabwe dollar deposits which had been stuck in banks since 2009, even though they say the values to be given are too low.

Towards the end of 2008, annual inflation in Zimbabwe had reached 231m%, pensions, wages and investments were worthless, most schools and hospitals were closed and at least eight in 10 people were out of work.