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Good news! You're rich, compared to Zimbabwe

By Catholic Online (NEWS CONSORTIUM)
January 30th, 2013
Catholic Online (www.catholic.org)

Chances are - you probably have more in your checking account than the African nation of Zimbabwe currently has. As of this week, Zimbabwe only had 127 dollars in its account.

LOS ANGELES, CA (Catholic Online) - Withering inflation in that nation led the government to issue a 100 trillion-dollar note in 2009, leading to reforms that reduced the cost of living but left Zimbabwe with almost no cash.

Finance Minister Tendai Biti says that $217 was all that was left in the country's public accounts after it paid its civil servants last week. According to the South African Press Association, Biti told reporters in the capital, Harare, that some of them were probably better off than the state.

Following 10 years of inflation hit 500 billion percent in 2008 - leading to the issuance of 100 trillion-dollar bills in Zimbabwean currency, the country switched to the U.S. dollar and formed a coalition government in 2009. The International Monetary Fund stepped up to the fore in September to take credit for taming inflation and stabilizing the economy.

Zimbabwe debt which the nation built up during those years of nationalist rule by President Robert Mugabe left it with a minimal tax base and few cash reserves. The dire situation led Zimbabwe vulnerable to economic "shocks."

One of those would appear to be the regular wage bill for civil servants - which accounts for 73 percent of the national budget.

An opposition member of Mugabe's coalition, Biti said the lack of cash threatened elections that are expected some time after a March referendum on a new constitution.

"The government finances are in a paralysis state at the present moment," he said, adding that the country might have to seek donations to stay afloat.

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