Barter Trade on The Rise On Account of Forex Shortage in Zimbabwe - - Report Submitted by Comptroller and Auditor General Mildred Chiri

SCHOOLS and colleges are being forced to engage in barter trade with students for the settlement of fees due to the scarcity of foreign currency, Zimbabwe’s auditor general has said.

In a report submitted to parliament last Friday, Comptroller and Auditor General Mildred Chiri said some people mostly in rural areas where settling their bills at health institutions, schools and training colleges using goats, maize among other valuables.

“My audit also revealed instances of barter trade where cash resources were not available and services were paid for by tendering of items of value,” she says in her report.

The Ministry of Finance, as the custodian of government’s finances and state assets, “had not foreseen this eventuality and they had not made suitable arrangements to cater for situations such as those presented especially in health institutions in remote and rural areas”, she said.

Although the Education Ministry had granted permission to some schools to engage in barter trade in the settlement of outstanding fees up to the end of December 2008, the practice was still ongoing, the report found.

Training institutions had also joined in the barter trade as education costs remain beyond the reach of many.

“Chamunuka Vocational Training centre in Mount Darwin district is a provincial skills training centre offering instruction in various disciplines at an average fee of US$155 per semester,” said Chiri.

“My examination of records maintained revealed that out of a total enrolment of 147 students, 44 had paid cash for their fees in full. Seventeen had not made any payments at all while a further 76 students had settled their outstanding obligations in kind by tendering of valuables other than cash such as sugar beans, cows, goats, wheat, maize, provisions, fertilizer, chemicals and fuel coupons.”

Zimbabwe dollarised its economy earlier this year and suspended its currency after years of hyperinflation.

On Friday, President Robert Mugabe, while admitting that the introduction of hard currencies had lowered prices, said dollarization had caused "untold suffering" in areas, where people were had no access to US dollar bills.

"We can't have a country like that," he said. "We are considering going back to our own currency. People must get money. If they don't, what are they going to buy with?"

Mugabe’s position is, however, at odds with his coalition partners in the unity government who say the local currency can only be restored after marked improvement in production and exports.