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Last Updated: Friday, 8 August, 2003, 11:00 GMT 12:00 UK
Zimbabwe tackles cash shortage
People queuing outside a bank, which has no cash
Queuing has become a way of life in Zimbabwe
The Central Bank in Zimbabwe is introducing travellers' cheques for local use in an attempt to ease the country's severe cash shortage, as the country spirals into an ever deepening economic crisis.

The bank says the travellers' cheques, which are legal tender and will be acceptable as payments for goods and services anywhere in Zimbabwe, will go into circulation on Friday, in denominations of between Z$1,000 and Z$100,000 (approximately $1.20 to $120).

The move is the latest in a series of measures by the Zimbabwean authorities to alleviate the cash crisis, which many blame on President Mugabe's controversial policies.

Meanwhile, the treason trial of opposition leader Morgan Tsvangirai is set to continue after a request by his lawyers for the charges to be dropped was rejected by a High Court judge.

'Restrictions'

The BBC's Peter Biles says that the government's desperate move is unlikely to restore any confidence in the country's beleaguered economy.

The bank has also withdrawn the highest denomination banknote to stop what they say is widespread hoarding.

President Robert Mugabe of Zimbabwe
Many blame the economic crisis on Mugabe's controversial policies

In recent weeks local banks have been crowded with thousands of ordinary Zimbabweans seeking to get money.

Many workers are not getting their salaries paid.

Some banks have been restricting withdrawals to Z$5,000 a day.

Unemployment is rising and inflation has risen to a record level of 365%, one of the highest rates in the world.

Last week, the government said it would be withdrawing the Z$500 from circulation to help persuade people to deposit their money in the banks.

Our correspondent says that although plans were announced for the issue of new high denomination banknotes, Zimbabwe can barely afford the materials for printing new notes.




WATCH AND LISTEN
The BBC's Juliet Dunlop
"Some banks have run out of money altogether"



SEE ALSO:
Zimbabwe slides into economic chaos
25 Feb 03  |  Business
Zimbabwe short of banknotes
09 May 03  |  Business
Zimbabwe mulls 'devaluation'
03 Feb 03  |  Business
Zimbabwe sanctions 'have failed'
02 May 03  |  Africa
Country profile: Zimbabwe
17 Apr 03  |  Country profiles


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