Zimbabwe battling hoax as well as skyrocketing prices
HARARE, Zimbabwe — Battling rampant inflation, Zimbabweans are counting their toes as they struggle to buy food for their families.
An internet rumor blazed through the country that desperate people were selling their toes for cash. The false report became so widespread that Kindness Paradza, the African country’s deputy minister of information, visited street vendors in Harare this month to debunk it.
Traders took off their shoes to show that they had all 10 toes, as Zimbabwe’s state media recorded the digital investigation.
Paradza declared the toes-for-money story a hoax, as did local and foreign fact-checkers. Police later arrested a street vendor who now faces a fine or 6 months in jail on charges of criminal nuisance for allegedly starting the story.
But it’s true that Zimbabweans are finding it increasingly difficult to make ends meet. Since the start of Russia’s war in Ukraine, Zimbabwe’s inflation rate has shot up from 66% to more than 130%, according to official statistics. The war is blamed for rising fuel and food prices.
The war has exacerbated rising inflation rates around the world. Consumer prices in the 19 European Union countries that use the euro currency surged a record 8.1% in May as energy and food costs climb. Turkey approached Zimbabwe’s eye-watering prices, with inflation reaching 73.5% in May, the highest in 24 years.
In Zimbabwe, the impact of the war in Ukraine is heaping problems on the already fragile economy. The war “coupled with our historical domestic imbalances, has created challenges
in terms of economic instability seen through the currency volatility and spilling over into price volatility,” Finance Minister Mthuli Ncube told Parliament in May.
Teachers “can no longer afford bread and other basics, this is too much,” tweeted the Progressive Teachers Union of Zimbabwe in early June. The three largest teachers’ unions are demanding the government pay their salaries in U.S. dollars because their pay in local currency is “eroded overnight.”
“Because of high inflation, the local currency is collapsing,” said economic analyst Prosper Chitambara.
“Individuals and companies no longer trust the local currency and that has put pressure on the demand for U.S. dollars. The Ukraine war is simply exacerbating an already difficult situation.”
Many fear Zimbabwe could return to the hyperinflation of 2008. At that time, plastic bags full of 100 trillion Zimbabwe dollar banknotes were not enough to buy basic groceries.
The economic catastrophe forced then-president Robert Mugabe to form a “unity government” with the opposition and adopt a multi-currency system in 2009 in which U.S. dollars and the South African rand were accepted as legal tender.
The U.S. dollar continues to dominate with prices in local currency often benchmarked to the rates for the American currency on the flourishing illegal market, where most individuals and companies get their foreign currency.
Many Zimbabweans who earn in local currency such as government workers are forced to source dollars on the illegal market, where exchange rates are soaring, to pay for goods and services that are increasingly being charged in U.S. dollars.
The once-prosperous country’s economy is battered by years of de-industrialization, corruption, low investment, low exports and high debt. Zimbabwe struggles to generate an adequate inflow of greenbacks needed for its largely dollarized local economy.