Cross rating continues in Bulawayo

ONE wonders if it is a curse to live and work in the City of Kings, Bulawayo, where one toils for a month only to have his or her salary's value being determined by a "hidden hand". It seems someone is running a parallel economy in Bulawayo, which is independent from the rest of the country.
Since the introduction and trading in multiple foreign currency early last year I have watched in dismay the rate at which my meager salary is slowly turning into "peanuts" because of the new wave of profiteering in the form of the foreign currency cross rate craze mostly of the United States dollar against the South African rand.
I am already seeing some form of unproductive devolution of powers, which is in bitter taste.
I appreciate that most of the goods in the city and the country at large are imported from South Africa and as such the weakening of the United States dollar (which is the dominant currency in Zimbabwe) has ripple effects in that it lessens the buying power of importers.
However, if that is the case, then Government should move in quickly and see to it that we adopt a single currency though it seems the hopes are gloomy as the latest revelations from the Minister of Industry and Commerce revealed that Government has done nothing with regards to joining the Rand Monetary Union maybe the only salvation lies in us (Zimbabwe) and the other countries in the region to expedite the calls of adopting a single trading currency for the whole region.
The other option is for us to adopt the US dollar as our official currency, this arises from the fact that our national budget is outlined using the greenback, even the payment of utilities. Fuel which is attributed to be the major driver of the economy is even pegged in US dollars.
South Africa's rand surged to a fresh 21/2 year high against the dollar on Tuesday as the greenback weakened globally and traders said the bullish trend in the local unit could open up the next key technical level of 6,85.
The rand has gained more than 7,0 percent so far this year as investors seek high yields globally. Traders are looking to 6.85 as the next key area for the domestic currency.
By the time of going to Press the rand against the US dollars was trading at $1 = R6.84. However, to many of us such technicalities and economics do not bother us, all that we want is to earn a decent wage whose value is not depreciated by some unorthodox means.
In essence due to the effects of cross rating, it means that someone that was earning US$100 in February had an equivalent of 1 000 rand and if that person was not awarded an increment (like yours truly) it means as of May his or her salary was now translating to 750 rand and to date it is equal to 700 rand.
This means retailers pricing their products in rand or at an exchange rate against the US dollar are continuously eroding the purchasing power of an individual. To a certain extent it means there is some form of price increase or salaries have been cut.
Purchasing power is the number of goods/services that can be purchased with a unit of currency. If one's income stays the same, but the price level increases, the purchasing power of that income falls. Inflation does not always imply falling purchasing power of one's income since it may rise faster than the price level. A higher real income means a higher purchasing power since real income refers to the income adjusted for inflation.
Only last week I was in Kwekwe and was taken aback by the fact that the cross rating phenomena is not as outrageous as the one in Bulawayo which is actually fair. For instance, one can buy two pies for US$1 or two Cascade juices for the same price but in the City of Kings you can only buy one of each of the items.
The city is known for its notoriety of having unauthorised exchange rate regulators. Though this has passed it seems most businesses still possess the culture of profiteering under the guise of cross rating.
Bulawayo was only second best in ways of making a "quick buck" when the Hararians crafted a way of withdrawing huge amounts per day through "burning" and that was late in 2007 and 2008. Burning was one of the many ways Zimbabweans made use of their imaginative abilities. Each time the Reserve Bank imposed daily cash withdrawal limits new methods of withdrawing millions were devised.
I vividly remember when the RBZ set Z$50 000 as the maximum daily limit when thousands of Zimbabweans had bank balances running into billions of worthless currency. If one had Z$1million it would take him close to a year withdrawing it. But a new illegal way of withdrawing the money was crafted in the form of "burning".