Zimbabwe's New Solution To the Economic Nightmare: Use US Dollars

Government workers and the military will start receiving their salaries not in Zimbabwean currency, which is worthless, but in US dollars in an attempt to revive the economy.

Robert Mugabe's economic and social policies have resulted in a complete implosion of the economy, with unemployment above 80% and inflation now running as high as 10 sextillion percent. The country can't keep up with printing money in denominations large enough so the last desperate gasp is to try and peg salaries and currency to the US dollar.

Zimbabwe's new finance minister says soldiers and civil servants have started to be paid in US dollars to help revive the shattered economy.

Tendai Biti, a member of the opposition party, said some 130,000 government employees were receiving $100 (£70) a month tax-free.

The state had enough foreign currency to pay the wages for February and March, Mr Biti told a news conference.

Hyperinflation has left Zimbabwe's local currency almost worthless.

Soldiers were paid in vouchers redeemable at selected banks on Tuesday, while teachers were to be paid on Wednesday and other civil servants on Thursday.

This is a concrete move in the right direction, but the problem is having enough currency on hand to last more than just the next few months. Prime Minister Morgan Tsvangerai's opposition party is making inroads in this area, as it is his policy people who have made this move, which includes pegging the Zimbabwean currency to the US dollar on a $1 to 1 Zimbabwean dollar by knocking 12 zeros off the Zimbabwean dollar.