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Zimbabweans hit by inflation: Will Gold Coins Help?

Zimbabweans hit by inflation: Will Gold Coins Help?
Written by Zimmy

Zimbabweans Hit, By Soaring Inflation: Will Gold Coins Help?: After working for the night as a security guard for an impoverished church in Harare’s Mabvuku township Jeffrey Carlos rushes home to assist his wife in obtaining the water she needs to market. A prolonged water shortage means that the majority of inhabitants of Harare’s capital city of over 2.4 million have to source the water themselves.

Carlos is blessed as the property he rents is well-watered and his family can collect the water in buckets to market to neighbors. “This is our goldmine,” he says of the water that comes from the well. “If we’re fortunate, we could sell twelve buckets (per each day) for just $2,” said the 50-year-old father of three children. It’s enough to pay for food for the entire day, he added. The rising cost of living and the decreasing currency has brought many Zimbabweans to the edge as they recall the times the time when this southern African country was hit by record inflation of five billion percent in the year 2008.

Zimbabweans hit by inflation: Will Gold Coins Help?

With inflation rising from 191 percent in June, to 257 percent in July, a lot of Zimbabweans are worried that the country could be returning to the same hyperinflation. To avoid a repeat of the same economic disaster the government of President Emmerson Mnangagwa this month took the bold decision of introducing gold-based coins as legal as legal tender. The central bank in Zimbabwe known as the Reserve Bank of Zimbabwe declared that the worth of the 22-carat one-ounce coins will determine the global price of gold, they could help reduce the raging inflation and help stabilize the currency of the nation.

The glimmer of gold coins is difficult to imagine for Zimbabweans who struggle every day to make the money they need to live. The government has a different view and is asking for more at the right time. Even though it’s expensive with an average cost of under $2,000 Central banking governor John Mangudya said the coin will create the effect of a trickle-down effect, which will eventually aid the common folk.

“The common man will be able to benefit by the security (provided with) this gold coin. If there is stability, money will be valued, and the prices will remain stable,” said Mangudya ahead of the official launch. The central bank will introduce smaller gold coins denominated in November in order to permit regular people to save money using them as a mechanism. The coins for smaller amounts will be half an ouncein weight, a quarter of an ounce, and 10 percent of an ounce, according to him. However, many like Carlos claim they are unable to pay for food, and even less, earn enough to put aside money.

“Where do I get the money to buy gold coins? They are for the wealthy. The poor like me don’t see any differences. The situation is still difficult for us in the United States,” he told The Associated Press between visits to the well to pick out buckets of water. “Gold coinage is a way to make money for the wealthy. The wealthy are richer and the poor are poorer,” said Gift Mugano an economics professor in an online roundtable debate that was titled: “Is there gold in the coins?” With the number of Zimbabweans struggling to find food every day, there is a need to know about whether gold coins aid them.

“People are in a state of distress. They’re living on the streets, and many people might not have enough money to save up in the first place. Many people are in survival mode because of the rising cost of living,” said Prosper Chitambara an economist from Harare. To survive most people are forced to accept several jobs. Carlos from Mabvuku reports that he earns approximately $100 per month from his position as an overnight security guard at a church as well as the bar that is next door. It’s not enough to cover rent and school fees as well as other necessities.

Sometimes, he trades water in exchange for food things. “If we need water for someone else but they aren’t able to pay then we exchange them beans, tomatoes, vegetables, or maize. This is how we can acquire the food we need,” he said.  wife of his, Christwish 43 prepares the evening meal of the day with the main meal of maize (corn) meal as well as vegetables gathered from the small backyard garden – and cooks them over the fire of a wood stove. Because of Zimbabwe’s prolonged power outages, children complete their work by lighting a candle, despite the fact that their parents insist that they utilize it in a limited manner.

“The wood for the fire costs $1 for a small amount that’s sufficient (to cook) to cook a meal. Candles are also costly,” lamented Christwish, who earns a living by helping with household chores for families with more money in exchange for cash and food products. Things once thought to be basic are now unobtainable according to her. “We used to eat bread and margarine on Christmas Day,” she stated. “Now we only find these things in shops and then leave them there.”

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Zimmy

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