For the second time, the US dollar has replaced the Zimbabwean dollar as the most-used currency in the southern African nation.
According to a Bloomberg report, US dollars were utilized for 77% of transactions this year, surpassing the proportion that was conducted in the local currency for the first time since it was reissued in June 2019.
Zimbabwe had abandoned its own currency in 2009 due to hyperinflation and replaced it with the US dollar and other foreign currencies.
In an attempt to revive the stagnating economy, the local currency was reintroduced in 2019 but has since depreciated 91% against the US dollar in the last two years.
As a result, local businesses are now charging in greenbacks for everything from food to medicines. The surge in dollar usage in Zimbabwe has led some economists to declare that “the economy for all intents and purposes is largely dollarized”.
The use of the US dollar in Zimbabwe comes as China seeks to internationalize the yuan and other countries, including Russia, India, and Saudi Arabia, look to reduce their dependence on the US dollar.