Chinese may become Zimbabwe’s official currency

2/1/2016 2:25:47 PM

Zimbabwe announced a plan to use the Chinese yuan as an official currency for business transactions. Part of a deal with China to adopt the yuan in Zimbabwe would also be a $40 million debt cut.

In mid 2015 Zimbabwe's central bank announced that it was finally phasing out the local currency, following hyperinflation had hurt the Zimbabwean dollar badly. The local had become almost worthless. At that time, 175,000,000,000,000,000 Zimbabwean dollars was valued at just 5 U.S. dollars.

Earlier on, foreign currencies such as the US dollar and the South African rand had become de facto currencies in Zimbabwe. The government had declared that it would officially allow businesses to use these currencies.

The Washington Post reports that the new agreement would add the yuan to this list of currencies used for public transactions, and the Zimbabwean government said it would encourage its use. Chinese tourists would be allowed to use the yuan to pay for services, and Zimbabwe would begin paying back its loans to China in the currency.

Further reading on washingtonpost.com

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