1887

n African Journal of Business and Economic Research - The role of dollarization in the non-payment of municipal bills in Mutare, Zimbabwe

Volume 9, Issue 2_3
  • ISSN : 1750-4554
  • E-ISSN: 1750-4562

Abstract

In order to stabilise the economy and promote development, the Zimbabwean government substituted its weak dollar with more stable foreign currencies in February 2009. This paper assessed the role of this 'full dollarization' in the non-payment of municipal bills and accumulation of debt by low-income residents of Mutare, Zimbabwe's fourth largest city. The study collected data through semi-structured questionnaires and reviewed municipal bills of one household. Three households (or 60% of the sample) belonging to a teacher, pensioner and informal sector employee owed Mutare Municipality several hundreds of U.S. dollars before debt cancellation in August 2013. The pensioner's household whose bills were analysed had no debt in Zimbabwean dollars, but accumulated US$301-400 during dollarization. He accumulated most of this debt in 2009 when he earned US$1-100 per month, from which he budgeted US$100 for food and paid on average US$5.63 for a US$23.55 monthly utility bill. His income in 2012 (about US$300) became enough to pay on average US$26.14 for a US$23.01 bill. Meagre salaries and not laxity were responsible for the debt.

Loading full text...

Full text loading...

Loading

Article metrics loading...

/content/aa_ajber/9/2_3/EJC165026
2014-01-01
2019-10-23

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error