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Monday, 19 May 2014

Did You Know Series (22): How to join the World Super-Rich Club? Own a Z$100 Trillion dollars Banknote from Zimbabwe!!!:



Did You Know Series (22): How to join the World Super-Rich Club?

Own a Z$100 Trillion dollars Banknote from Zimbabwe!!!:

The Z$ 100 Trillion Banknote:

Zimbabwe has released in the trillion-dollar denomination of 10, 20 and 50, but the largest denomination issued was the Z$100 trillion dollar denomination Banknote, to help Zimbabweans cope with hyperinflation.

The Front of the Z$ 100 Trillion Banknotes, exhibits the Chiremba Balancing Rocks. (Details given in the Banknotes of Zimbabwe section)

The Back of the above Banknote, showing the Victoria Falls and a buffalo, an animal found in Zimbabwe.

In 2008, the latest annual figure of inflation estimated to be 231m% was the world’s highest. With a view to ensure that the public had access to their money from banks, the Reserve Bank of Zimbabwe introduced a new Series of Banknotes with the highest denomination being Z$10 trillion.

The economy was still in such bad shape that very few products were still available in the local currency with prices doubling at short intervals. Most groceries were being brought in by Zimbabweans from neighbouring South Africa, Botswana and Zambia, further driving up the prices.

The situation came to such a sorry state of affairs, that more than 80% unemployment prevailed in the country and citizens with jobs found there salaries to be worthless, unless they were paid in foreign currency.

Currency Note dealers are today found to be advertising for selling the Zimbabwean 100 Trillion Banknote as the best selling Banknote and exhorting collectors to get their Z$100,000,000,000,000 bill immediately. They go on to add that the Collector should in fact buy ten of these Banknotes and own a Quadzillion Zimbabwean dollars (Z$ 1000,000,000,000,000, before prices shoot up due to scarcity of this denomination!!

The Z$100 Trillion when issued was worth about US$300. Today, it is a sad state of affairs, when street sellers are willing to part with slightly worn ones to foreign tourists from anywhere between US$ 20 to giving them for US$ 5 (after driving a hard bargain) urging the tourists to take them as souvenirs.

Some currency vendors even have books of 100 trillion dollar Banknotes in mint condition for between USD 10 to USD 15.

A brief  on the circulation of coinage in and creation of the Republic of Zimbabwe:

The British South African Company headed by Cecil Rhodes possessed vast territories in Africa outside South Africa. British and South African coins circulated in these territories.

In 1923, it was proposed and rejected to incorporate these territories into the Union of South Africa. Instead, the territory was broken up into the colony of Southern Rhodesia and the Protectorates of Northern Rhodesia and Nyasaland.

In 1932, distinctive silver coins were adopted.

In 1934, holed cupro-nickel halfpennies and pennies were circulated.

Between1955-64, the Federation of Rhodesia and Nyasaland followed suit.

In 1964, on the break-up of the Federation, Nyasaland became Malawi and Northern Rhodesia became Zambia and both countries introduced their own distinctive coinage (Tambala in Malawi and Ngwee in Zambia) in the same year. Later, both countries adopted the decimal system based on the Kwacha (Malawi in 1971 and Zambia in 1968.based on a decimal system.

In 1965, the former Southern Rhodesia unilaterally declared its Independence and was hitherto called Rhodesia. The regime headed by Ian Smith was declared illegal and its coins continued to portray Queen Elizabeth II until 1970.

In 1970, the Republic of Rhodesia was declared and the country adopted an armorial reverse on its coinage.

In 1978, Ian Smith signed a pact with moderate African leaders and the country name was adopted as Zimbabwe Rhodesia. However, no coins bearing the double name was ever issued.

In 1980 the Republic of Zimbabwe was created. The country minted coins inscribed with the National Emblem of a bird carved from soapstone on the obverse in the same year.

Banknotes of the  Zimbabwean dollar (Z$):

The Zimbabwean dollar (Z$) was the official currency of Zimbabwe from 1980 to 12.04.2009 (when its circulation was suspended as the currency became worthless).

The Zimbabwean dollar was positioned to be among the highest valued currencies when it was introduced in 1980, when it replaced the Rhodesian dollar at par. However, owing to hyperinflation, the value of this currency sharply eroded, so much so that it became the least valued currency in the World. The Zimbabwean dollar underwent three redenominations (in 2006, 2008 and 2009) with very high currency denominations being issued to shore up the currency.

The First Zimbabwean dollar:

Desmond Krogh Series (1980/81 to 1983):
In 1980, the first Zimbabwean dollar was circulated, replacing the Rhodesian dollar, the then circulating currency in Zimbabwe (then equivalent to half a pound sterling or fifty pence) at par. This exchange value had declined sharply by July 2006 to an exchange rate of Z$ 100 to 1 GBP.

This series is remembered as the Desmond Krogh Series, Krogh being the last Governor of the Reserve Bank of Rhodesia. This Series was in circulation from 1981 and the Banknotes bear the name of Salisbury as the capital instead of Harare (the name of Salisbury was changed to Harare on 18.04.1982).

The denominations issued were Z$ 2, Z$ 5, Z$ 10 and Z$ 20.

Since 1980/81, the Front of the Banknotes showed the Chiremba Balancing rocks in Epworth, Harare. The Balancing Rocks theme was taken so as to represent the importance of finely “balancing” the all round development, economic growth and protecting the natural resources/environment of the country. The front also depicted a prominent animal found in Zimbabwe on each Banknote. The balancing rocks also were a part of the Reserve Bank of Zimbabwe emblem which was used on Bearer and Agro cheques which were in circulation from 15.09.2003 to 31.12.2008.

The Back of the Zimbabwean dollar Banknotes depicted the culture or landmarks of Zimbabwe along with some animals and fish found in Zimbabwe. The watermark on this series was the Zimbabwe Bird National emblem.

The Chiremba Balancing Rocks:
The Chiremba Balancing Rocks were declared a National Monument in 1994. It is located about 13 kilometres south-east of Harare in Epsworth. The formation is characterized by granite balancing rocks within a natural scenic environment. The balancing rocks now symbolize peace and stability of the nation’s economy. These rocks, thus, symbolically represent harmony between all the parameters of economic growth and development. During the colonial era, the Balancing Rocks were adopted as one of the motifs depicted on Rhodesian Banknotes. The symbolic significance has been carried forward by Zimbabwe after Independence, as well.

The above is an image of the Chiremba Balancing Rocks at Harare.
Kombo Moyana series ( from 1983 to August 1993):
This Series is remembered as the Kombo Moyana Series, named after the Reserve Bank of Zimbabwe Governor who was in office from 1983 to 1993. This Series bears the name of the capital as Harare (in place of the earlier Salisbury).

The denominations of Banknotes issued under this series were Z$ 2, Z$ 5, Z$ 10 and Z$ 20 as in the case of the First Series or First dollar. Again , on the Front, these Banknotes depicted the Chiremba Balancing rocks ,along with some animals found in Zimbabwe.
The Back of the Zimbabwean dollar Banknotes depicted the culture or landmarks of Zimbabwe along with some animals and fish found in Zimbabwe. The Watermark, once again was the Zimbabwe Bird National emblem.

Leonard L. Tsumba Series (August 1993 to 2004):
This Series is known as the Leonard Tsumba Series, named after the Reserve Bank of Zimbabwe Governor who took over charge from Kombo Moyana in August 1993.

This Series improved upon/introduced some security features to prevent counterfeiting, for example, latent imaging in which the letters RBZ can be seen when the Banknote is tilted horizontally at the eye-level and identification marks for the visually impaired were added and the neck of the Zimbabwe Bird watermark was elongated.

This Series included the following denominations: Z$ 2, Z$ 5, Z$ 10, Z$ 20, Z$ 100, Z$ 500 and Z$ 1000.

The Front of a Z$ 1000 Banknote issued in 2003 exhibiting the Chiremba Balancing Rocks.

 
The Back of the above Z$ 1000 Banknote depicting three elephants. 

Once again, on the Front, these Banknotes depicted the Chiremba Balancing rocks, along with some animals found in Zimbabwe.

The Back of the Zimbabwean dollar Banknotes depicted the culture or landmarks of Zimbabwe along with some animals and fish found in Zimbabwe.

Gideon Gono Series (2004 – 21.08.2006):
Gideon Gono was the next Reserve Bank of Zimbabwe Governor. Only one denomination was issued during his tenure Z$ 500. It essentially had the Chiremba Balancing rocks on the Front and the Hwange Power Station on the Back. This issue also carried the Zimbabwe Bird watermark.

The second Zimbabwean dollar or the “First redenomination” in 2006:

The value of the first Zimbabwean dollar which was at par with the US dollar in 1983, went into a tail-spin and by July 2006, the exchange rate became over 500000 Z$ to 1 USD.

On 01.08.2006 the first Zimbabwean dollar was redenominated at the exchange rate of 1 second Zimbabwean dollar to 1000 first Zimbabwean dollar. This redenomination was carried out under a currency reform codenamed “Operation Sunrise” which had the motto “From Zero to Hero” for the Zimbabwean currency.

 At the time of introduction/circulation of the second Zimbabwean dollar, the exchange rate for the USD was fixed at Z$ 650 to 1 USD. This exchange rate fell dramatically to 758,530,000,000 to a USD by July 2008.

The Third Zimbabwean dollar or the second redenomination in 2007:

The 2007 Banknote Series:
From 01.08.2008, the Zimbabwean dollar was redenominated once again. The denominations issued were coins of denominations Z$ 5, Z$ 10, Z4 25 and Banknotes in the denominations of Z$ 1, Z$ 5, Z$ 10, Z$20, Z$100 and Z$ 500, Z$ 500, Z$ 1000.

 A large number of the third Zimbabwean currency Notes were got printed through Giesecke & Devrient, a German firm, one of the largest Paper and security suppliers in the World, after which the printing arrangement was terminated by the German firm.

Nevertheless, inflation continued to grow by leaps & bounds leading to another redenomination of the Zimbabwean dollar.

By July 2008, the annual inflation rate had been estimated to be about 231 million percent.

On 15.08.2008, the rate of exchange which was fixed at Z$244.83 to a US dollar climbed steeply to Z$ 29325 to a US dollar.

On 13.09.2008, due to cash shortages and the value of the Zimbabwean dollar being practically nil, foreign currency was effectively made legal tender through a special programme to give licenses to several   currency retailers to accept foreign currency.
 This led to several shop-keepers refusing to accept Zimbabwean dollars and asking for US dollars or South African Rands in payment.

The 2008 Banknote Series:

The 2008 Banknote series was circulated from 20.09.2008 to 12.04.2009.

This Series indicated the alarming proportions to which hyperinflation had gripped the Zimbabwean economy.

On the Front, this Series had the usual Chiremba Balancing Rocks design.
The denominations included in this Series and the designs on the Back of these Banknotes were : Z$ 10000 (Combine Harvester and tractor), Z$ 20000 (Victoria Falls and Kariba Dam), Z$ 50000 (Farm Tractor and miner), Z$ 100000 (African buffalo and elephant), Z$ 500000 (Trees of “aloe excelsa” and milking farm), Z$ 1 million or 1000000 (Great Zimbabwe Ruins and Bull), Z$ 10 million or 10000000 (Parliament Building, Anglican St. Mary’s Cathedral  and Great Zimbabwe ruins), Z$ 50 million or 50000000 (African buffalo and Great Zimbabwe ruins), Z$ 100 million or 100000000 (Grain belt and silo towers), Z$ 200 million or 200000000 (Parliament buildings, Anglican St. Mary’s Cathedral and Heroes’ Acre), Z$ 500 million or 500000000 (Milking Farm and miner), Z$ 1 billion or 1000000000 (Trees of “aloe excelsa” and elephant), Z$ 5 billion or 5000000000 (Farm Tractor and milking farm), Z$ 10 billion or 10000000000 (Kariba Dam and miner), Z$ 20 billion or 20000000000 (Great Zimbabwe ruins and trees of “Aloe excelsa”), Z$ 50 billion or 50000000000 (Great Zimbabwe ruins and Reserve Bank of Zimbabwe building), Z$ 10 trillion or 10000000000000 ( Great Zimbabwe ruins and Reserve Bank of India Building), Z$ 20 trillion or 20000000000000 (Miner and grain silo), Z$ 50 trillion or 50000000000000 (Kariba Dam and elephant) and Z$ 100 trillion or 100000000000000!!!! (Victoria Falls and Buffalo).

By end of 2008, the Zimbabwean dollar had become largely sidelined and the economy was running on US dollars.

In January 2009, the Reserve Bank of Zimbabwe legalized the use of foreign currencies including the Indian Rupee, US dollar, South African Rand, Botswana pula, Euro, Yuan, Pound Sterling etc.

The Fourth Zimbabwean dollar or the third redenomination in 2007:

On 02.02.2009, announced that a further 12 zeros were being taken off the currency, with 1,000,000,000,000 third Zimbabwean dollars being exchanged with 1 fourth dollar. Banknotes in the denominations of Z$ 1, Z$ 5, Z$ 10, Z$ 20, Z$ 50, Z$ 100 and Z$ 500 were issued.

On the Front these Banknotes again had the Chiremba Balancing Rocks design, while on the Back, the following designs were taken: Z$ 1 (Farm workers in a village), Z$ 5 (Tigerfish and Kariba dam), Z$ 10 ( Great Zimbabwe ruins), Z$ 20 Hwange Power station), Z$ 100 (View of Harare with the Freedom Flame) and Z$ 500 (three elephants).

On 12.04.2009, the Zimbabwean dollar ceased to be the official currency due to unbridled inflation when it was estimated that a person could not buy anything even if he was willing to pay a billion Zimbabwean dollars. The Government decided to only reintroduce the Zimbabwean dollar, if the industrial growth and the economy improved.

Zimbabwean Coinage:

In 1980, coins were introduced in Zimbabwe in the denominations of 1 (bronze), 5, 10, 20, 50 cents and 1 dollar (all minted in cupro-nickel).

   Reverse images of some Zimbabwe coins minted in 1980 (20 &10  cents and Z$1),   1982 (5 cents) and 1983(1 cent - bronze).
 Obverse images of the above coins all depicting the Zimbabwe Bird

In 1989, bronze plated steel was used in place of bronze.

In 1997, a 2 dollar coin was circulated.

In 2001, nickel-plated steel replaced the cupro-nickel alloy in 10, 20, 50 cents and I dollar. In the same year a bimetallic Z$ 5 coin was circulated.                   
In June 2005, the Reserve Bank of Zimbabwe mooted issuing Z$ 5000 and Z$ 10000 coins, a plan which was shelved in view of rampant hyperinflation.

In August 2008, all the old coins dating back to the first dollar were reintroduced at face value to the third dollar effectively increasing their value 10 trillion times. Also in the same year Z$ 10 and Z$ 25 coins, minted in 2003, were circulated with the redenomination.

Reserve Bank of Zimbabwe logo:

The Reserve Bank of Zimbabwe logo inspired by the Chiremba Balancing Rocks.

National Flag of Zimbabwe:


The National Flag depicts the Zimbabwe Bird, the National Emblem of Zimbabwe.

National Emblem of Zimbabwe:

The National Emblem of Zimbabwe is the stone-carved Zimbabwe Bird which appears on the National Flags and Coat of arms of both Zimbabwe and Rhodesia as well as on their Banknotes, coins and stamps. 

It is thought to represent the Bateleur Eagle (The Bateluer Eagle or “Terathopius ecaudatus” is a medium-sized eagle in the family “Accipitridae” and its closest relative is the snake eagle – “Bateleur” in French means “street performer) or the African Fish Eagle (The African Fish Eagle “Haliaeetus vocifer” is a large species of eagle found throughout sub-Saharan Africa, wherever large bodies of water with abundant food supply are located). Both birds are found in Africa.

We happened to see these birds during our trip to the Mole National Park in Ghana, West Africa in February 2013.

The Zimbabwe Bird was originally found carved in the ruined city of Great Zimbabwe, which was built by the ancestors of the Shona (Shona is the name given to two groups of Bantu people in the East & South-East Zimbabwe, Botswana and Southern Mozambique. The only Western Shona group is called the Bakalanga. They are the largest ethnic group in Zimbabwe) starting from the 11thcentury and continuing over 300 years.
European colonists are credited with the discovery of the ruins of Great Zimbabwe and they found statues of five carved birds which came to be in the possession of Cecil Rhodes. When Zimbabwe became Independent in 1980, four of these statues were returned to Zimbabwe, while the fifth is kept at Groote Schuur, Rhodes home in Cape Town.

Some interesting tit-bits:

When I was staying in Hyderabad , Andhra Pradesh, India during 2004-2006, I was a member of the "Society to Save Rocks".  I happened to come across some interesting Rock formations during some of my “Rock Walks" with the Society.

Some images are given below:

                 Hyderabad's equivalent to the "Chiremba Balancing Rocks"?
 "Snoopy Rock" , named after the dog in the Cartoon strip "Peanuts".
           "Hamburger Rock"  or the "Seven Tiles Balancing    Rock"             formation
                            "United We Stand" Balancing Rocks formations
Posted on 19.12.14:
The following information has been contributed by Mr. R.N. Lalingkar:  
"Very interesting information about 'Zimbabwean' Bank Notes. I have also some other information about 'Balancing Rocks'. When I visited Vancouver (Canada) in 2010 , I found some interesting stone structures (depicted in photo attached) which is called by locals as "INUKSHUK". It is constructed on the sea-shore for the knowledge of captains of the ships passing by. The plaque is also placed nearby".

Posted by me on 19.12.14: 
Zimbabwe has proposed to issue “bond” coins in the denominations of 1c, 5c, 10c, 25c, and 50c. The 50c coins shall be released into circulation in March 2015 due to adding necessary security features in the design and manufacture of this coin denomination.These coins are being minted in South African Mint.

The bond coins are being introduced to buttress the multiple currency system through the provision of change, especially for the US$ Banknotes which have the US $1 as the smallest denomination in circulation in Zimbabwe.

The bond coins will be at par with the US cents. The introduction of these coins would necessitate correct pricing for goods and services which hitherto was constrained by the absence of an appropriate system of coins. These coins are expected to help out in mitigating Zimbabwe’s lopsided pricing structure for the convenience of consumers.

Thus, these coins will serve a two-fold purpose – firstly, due to the chronic shortage of coins and prompting businesses and shopkeepers to give out pieces of candy as change or to round up or down to the nearest dollar and secondly to have the chance to issue the country’s own coinage as the US Treasury could not transport a substantial number of US coins to mitigate the problem in Zimbabwe.

Why the term “bond” coins?

The bond coins derive their name from the US $50 million bond coin facility that the Reserve Bank of Zimbabwe has arranged for the purpose of providing the coins with intrinsic value. As the coins are backed by a “Bond” from which they derive their name, they are referred to as Band coins. The bond coins would be a good store of value.

Consumers and businesses will be able to exchange  the coins for banknotes/paper currency at their Banks. The initial amount to be made available is US $10 million worth of bond coins which will be released into circulation between 18th December 2014 and March 2015. The circulation of these coins will be limited to Zimbabwe only.
The Reserve Bank of Zimbabwe issued notification of the new bond coin images circulation of which commenced on 18th December 2014 in a phased manner upto March 2015.


Posted on 08.01.2016:

Zimbabwe has recently announced that it will soon adopt the Chinese Yuan as its main currency.

When this happens, Zimbabwe will be the first country outside the People’s Republic of China to use the Yuan as its currency in domestic circulation. So far, Zimbabwe has relied upon the US dollar and South African Rand during the past couple of years.

China in turn is offering to cancel a debt of $40 million, which Zimbabwe has been unable to repay.

While the Yuan has been a legal tender in Zimbabwe’s multi currency system for the past two years as well, it is now expecting the Zimbabwean government to encourage wider use of the Yuan and is also contemplating fresh loans to facilitate the process.  Making the Yuan the legal tender in another country is designed to take forward the People’s Republic of China’s programme of internationalisation of the Yuan. Interestingly, as part of this policy, the Chinese Yuan has recently been admitted as one of the Basket of Preferred Currencies in its Special Drawing Rights.




(The above Banknotes are from the collection of Jayant Biswas. The coin images of the earlier coinage have been contributed by Dr. P.V. Satyaprasad. Article researched  and  written and Banknotes and photos scanned by Rajeev Prasad)

An anecdote: Recently, I was given a visiting card by a Coin/Banknotes shop. The card, inter alia, mentioned: "Dealers in Notes and Coins and Antics".


8 comments:

  1. Ramchandra Lalingkar has commented:
    "One Hundred Trillion Dollars Note !!.......My GOD !!!! By the way.....what is it equivalent to Indian Rupees? The balancing rocks are common scene in Southern part of India.....especially in Andhra Pradesh and Karnataka".

    ReplyDelete
  2. The Zimbabwean dollar has no value today except for collector's interest who may pay the equivalent of five to fifteen US dollars just to have this denomination in their collection. The Z$ 100 Trillion Note could not even buy a loaf of bread for the citizens, when this currency was suspended from circulation in 2009 and other foreign currencies were legally permitted to circulate in Zimbabwe.

    ReplyDelete
  3. Ardee Numis has commented:
    "You write v well, Rajeev ji ... Always makes for interesting reading ..."

    ReplyDelete
    Replies
    1. Thank you, Ardee. Really appreciate your comment.

      Delete
  4. The first thought when I saw this post was of the rocks at Hyderabad (fast disappearing now though :-().. wondering that Zimbabwe did not have anything better to showcase on such a unique banknote :-)

    To my surprise.. your post covered the Hyderabad rocks as well.. you really leave no stone unturned in covering any and all related aspects to the subject of the post..

    The bond coins appear interessting.. a renewed case of Dollarization.. such as Ecuador (since 2000) and Panama (since 1940s) where the coins are equivalent in shape, size and value to the US cents.

    ReplyDelete
    Replies
    1. Thank you Rahul. Nevertheless, the Bond coins have not been very popular all over Zimbabwe and are not being accepted as "currency", based on past experience, leaving the government somewhat bewildered.

      Delete
  5. Just realised that the blog posts are well suited even for mobile devices. kudos to you

    ReplyDelete
  6. Blogger has a feature which makes the blog compatible to both. The readers/visitors can check up information on the go, as well.

    ReplyDelete