Zimbabwe has announced that the country is making plans to make the Chinese Yuan legal tender after Beijing confirmed it would cancel $40 million in debts, Guardian UK reports.
One of the country’s ministers, Patrick Chinamasa, confirmed the news, stating, “They [China] said they are cancelling our debts that are maturing this year and we are in the process of finalising the debt instruments and calculating the debts.”
Chinamasa is also said to have announced that Zimbabwe will officially make the Chinese yuan legal tender as it seeks to increase trade with Beijing.
The report further provides deeper insight into Zimbabwe’s currency woes, and the country’s ‘love affair’ with China:
- Zimbabwe abandoned its own dollar in 2009 after hyperinflation, which had peaked at around 500 billion percent, rendered it unusable
- It then started using a slew of foreign currencies, including the US dollar and the South African rand
- The yuan was later added to the basket of the foreign currencies, but its use had not been approved yet for public transactions in the market dominated by the greenback
- China is Zimbabwe’s biggest trading partner following Zimbabwe’s isolation by its former western trading partners over Harare’s human rights record
Photo Credit: Guardian UK/Huang Jingwen/Xinhua Press