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New note for inflation-riddled Zimbabwe

Robert Mugabe - Ordered businesses to halve prices last month
Robert Mugabe - Ordered businesses to halve prices last month

Zimbabwe's central bank has introduced another higher denomination banknote as it struggles with massive inflation which is rendering lower-value banknotes useless.

The new 200,000 Zimbabwe dollar note is the latest addition to a series of temporary bank notes introduced as a stop-gap measure at the height of a critical shortage of bank notes.

It is worth around €10 at the official rate and under €1 at the black market rate.

The Reserve Bank of Zimbabwe said in an advertisement in the government-run Herald newspaper it was introducing the new Z$200,000 bearer cheque with effect from 1 August 2007 for convenience.

Zimbabwe is in a chronic economic crisis with inflation officially at over 4,500% per annum, though analysts believe it could be double that.

The IMF says inflation could reach 100,000% by the end of the year.

There is 80% unemployment and no fewer than 80% of the population live below the poverty threshold.

In July last year the central bank slashed three zeros from the  country's currency and introduced new bank notes for shoppers who had to carry rucksacks full of notes to buy ordinary groceries.

Last month President Robert Mugabe's government ordered businesses to halve the prices of their goods and services.

The government said some shop owners were colluding with Mr Mugabe's enemies to plot his downfall by increasing prices and fuelling inflation.