Zimbabwe to issue $75 million in bond notes

Zimbabwe’s central bank Governor John Mangudya announced the bank will start circulating $75 million worth of bond notes in October.

The announcement has sparked fears of a return to hyperinflation which wrecked the economy years ago.

The notes will first be introduced with $1 and $5 denominations.

The plan is backed by a $ 200m bond facility from the African Export-Import Bank .

An earlier announcement of plans to introduce the notes sparked riots in the capital.

Zimbabwe adopted the US dollar and South African rand in 2009 after inflation peaked at 231 million percent rendering the local dollar worthless.

But the country has run out of US dollar notes in recent months, and hopes to ease the cash crunch by printing its own “bond notes” that will be valued in denominations of $2, $5, $10 and $20, which will have no value outside the country.

Agencies