Mugabe: ‘I Will Soon Retire’

One of Africa’s longest-serving presidents Robert Mugabe of Zimbabwe says he will retire after the 2018 election.

According to eNCA, the 92-year-old told war veterans Monday that due to the financial crisis in the country, he would retire.

However, Mugabe said that he will retire in 2023, after he has contested the presidency in the 2018 general election.

“We are in a critical time…for regime change,” Mugabe, the leader of the ruling party, Zimbabwe African National Union-Patriotic Front (Zanu-PF), said.

Mugabe previously asserted that he will never quit and has been in power for more than 35 years.

Zimbabwe’s Woes

According to CNN, hyperinflation (or the extremely high rise of the price of goods and services)  in Zimbabwe began early this year, leading banks in the country to run out of cash. 

Citizens reacted to the shortage by either holding on to their cash, transferring it abroad, or even selling it.

These acts could encourage tax evasion and money laundering, according to the Reserve Bank of Zimbabwe. Therefore, it advised citizens to save their money in bank accounts.

Reserve Bank Governor Dr. John Mangudya said that the government will introduce bond notes to counter the cash shortage and hyperinflation starting next week, reports News24.

The bond notes will reportedly be backed by a $200 million loan from the African Import-Export Bank and be in denominations of $2 and $5. They will be pegged to one of the country’s existing currency, the American dollar. Therefore, the value of each Zimbabwean bond note will move at the same rate as each American dollar.

The country also uses eight other foreign currencies, including the British pound, euro, and Chinese yuan. The scarce American dollar, however, is most commonly used among citizens.

Critics fear that the introduction of bond notes will take the country back to their own currency, the Zimbabwean dollar, which was abandoned in 2009 because it is valueless.  

The current crisis is reminiscent of past hyperinflation.

According to the World Bank, hyperinflation between 2000 and 2008 transformed Zimbabwe from a country that had no debt to a pauper. At the time, it was caused by economic slowdown and rising interest rates.

As a result, 3 million Zimbabweans emigrated to other African countries, and those who remained faced unemployment, declining health and education services, and food shortages.

The country was also isolated from the international community, which could have assisted with development financing.

In 2009, Zimbabwe abandoned its own valueless dollar in favor of a foreign multi-currency system. This move led to a rise in its economic growth.