Return of the Zim Dollar?

The Mail & Guardian  reports that the Zimbabwe government is in advanced stages of resurrecting the Zim dollar. I noted to clients yesterday that this shouldn’t be a major problem if the government continues to allow foreign currencies to circulate next to the Zim dollar, but that if the public don’t accept the Zim dollar as payment for goods and services, the government would have to resort to force to get people to use the currency again and ban foreign currencies. This would be very disruptive to the overall economy and could send the economy back into collapse.

Professor Steve Hanke sent two tweets about this yesterday that I thought were good and worth sharing, because I agreed with them. Prof Hanke was an advisor to the Zim government and advocated a complete dollarisation of the economy, which after implementation instantly stabilized the collapsing economy.