Tensions rise in Harare over cash crunch

Hundreds of government critics gathering in a public square were met with tear gas, water cannon and batons by police on Wednesday, as political tensions simmer over the southern African nation's worsening economic crisis. Organizers of the march in Harare said 20 people were injured.

Zimbabwe abandoned its currency in 2009 following hyperinflation, adopting a multi-currency system dominated by the United States dollar and South African rand. But a shortage of hard currency has caused banks to limit withdrawals and has denied many their salaries and pensions.

The central bank now plans to introduce "bond notes" in October to ease the cash crunch. President Robert Mugabe in June defended the introduction of the local banknotes, calling them a "surrogate currency" that would ease the crisis.

But critics fear the move will open the door to rampant money printing, as happened in 2008 when inflation hit 500 billion percent, wiping out people's savings.

Protestors tried to march peacefully on the capital, offering impassive riot police flowers and singing songs in a festive atmosphere.

Tear gas and flowers

"We know what happens when the central bank prints money," Promise Mkwananzi, leader of the social media movement #Tajamuka, said. The name of her initiative is a slang term in the Shona language for "defiance."

"Our message to Mugabe […[ is that we don't want those bond notes."

In recent months, Zimbabwe has had almost weekly protests often ending in clashes with police, as citizens organized protests against economic hardship. Wednesday's rally was no exception, with hundreds fleeing baton-wielding riot police who scattered anti-government demonstrators.

There was no official comment from the central bank or finance ministry Wednesday. President Mugabe, who has held power since 1980, has responded to the recent protests by saying that people who are unhappy with living conditions were welcome to leave the country.

jar/sms (AP, Reuters)