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In Quito and Harare, advice and warnings about dollarization for Argentina

In Quito and Harare, advice and warnings about dollarization for Argentina

FROM Zimbabwe's capital Harare to Quito in Ecuador, green bills circulating on the streets and in shops with images of U.S. presidents reflect a big choice that has been made: picking the dollar over the local currency to bring economic stability. The two countries offer a lesson - and warnings - for Argentina, the latest nation globally to toy with the idea of ditching an embattled local tender in favour of the greenback, a signature campaign pledge of President-elect Javier Milei. Dollarization or the part-way option of a peg to the dollar has generally been triggered as a last-ditch option to…
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Zimbabweans hit by rising prices as local currency plummets

Zimbabweans hit by rising prices as local currency plummets

ZIMBABWEAN businesses and households are fearing a repeat of the hyperinflation seen more than a decade ago as prices of basic commodities spike after a sharp weakening in the local currency, despite government efforts to boost it. The Zim dollar has so far this month plunged more than 50% in value against the U.S. dollar after the government announced on May 29 measures to encourage the use of the local currency - as opposed to the dollar - in a bid to tame inflation. The currency has weakened by more than 80% since the start of the year. "I went into the…
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Sudan inflation soars, raising spectre of hyperinflation

Sudan inflation soars, raising spectre of hyperinflation

PATRICK WERR INFLATION in Sudan has risen to one of the highest levels in the world, and the country risks slipping into hyperinflation unless it gets its budget deficit and money supply under control, economists say. The runaway prices have worsened an economic crisis for millions of ordinary Sudanese and imperilled a political transition under a military-civilian power-sharing deal. The government has run up enormous budget deficits by subsidising the cost of fuel, then financed the deficits by printing money. This has debased the currency, weakening it against other currencies and driving inflation up to annual 230% in October, according…
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Zimbabwe’s restrictions on mobile money transfers are a blow to financial inclusion

Zimbabwe’s restrictions on mobile money transfers are a blow to financial inclusion

MARCIA KWARAMBA, Scholar-in-Residence in the Social Responsibility and Sustainability Division, University of Colorado Boulder MOBILE financial services are, in most African countries, born out of crises. In 2011, Zimbabwe had gone through a volatile decade of economic crises – hyperinflation, currency instability and a collapse of the formal financial system. Consumers, mostly employed in the informal sector, had a widespread mistrust of the formal banking system. In came Econet, a major mobile operator, to launch a mobile money service called Ecocash. Taking advantage of the country’s high mobile penetration, the service had 2.3 million users within 18 months. Today, close…
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