1. Operation Sunrise Even as this report was in final stages of preparation, the Reserve Bank of Zimbabwe (RBZ) suddenly launched a new offensive called “Operation Sunrise”. This is aimed at one level at introducing a new set of monetary bearers cheques with a value of one thousand times as much as those currently in circulation, by dropping three zeros off each denomination: ie Z$ 1,000 has become worth Z$ 1. In Zimbabwe’s hyperinflationary economy where people now carry money in boxes, this measure is overdue.22 “Operation Sunrise” is also clearly an attempt to control the massive 80% of both local and foreign currency that currently does not pass through the banking system, passing from hand to hand on the streets. Once more, it is the informal sector that is the target of this latest operation, and while there is justification in the desire of the RBZ to control the monetary system and the parallel currency market more effectively, reports after one week of the operation indicated that it is the poorest of the poor who are suffering financial losses under the currency change over. On Saturday 5 August the authors were receiving reports that bands of youth militia were confiscating any sum of money more than Z$3 million (less than US$ 5 at parallel rates) of the old currency found on Harare commuters: this is illegal. According to Gono’s own regulations, Zimbabweans are entitled to up to Z$ 100 million (US$ 400 at official rates, or 160 at parallel rates) in the old currency on their persons without explanation. For amounts greater than this, tax clearance is needed. But as usual, there is proving to be no legal redress for desperate commuters, who were heading home with their precious week’s pay and who have had millions of dollars quite simply stolen from them by youth militia. The cities are under siege, and there are road-blocks every few kilometres on the main roads into the country. Human rights are being trampled on as youth militia are given powers beyond their rights and conduct strip searches of cross border traders, confiscating hard earned wares being brought back into the country for resale. It is legal to bring in goods up to the value of US$ 350 per month, but this is allegedly being disregarded. In a nation where 80% of people earn their income from the informal sector, the actions of Operation Sunrise are plunging those with no redress into further poverty. 2. Summary of initial impact of OM on informal trading sector “Operation Murambatsvina” targeted first and foremost the informal trading sector. The informal sector was and continues to be the lifeblood of the nation. With formal unemployment standing at over 80%, and with over 80% of the population below the poverty datum line, the informal sector was in 2005 estimated to control as much as 60% of GDP. Much to the ire of government, this money was trading without ever passing through the formal banking system – or the tax department. A thriving parallel market in foreign exchange meant that 90% of money earned in the Diaspora and sent home to Zimbabweans was also not passing through the Reserve Bank.23 22 As the new money is becoming standard in the process of this report being written, monetary figures will be given in both the new value, and the old (with the 3 zeros), the latter in brackets. 23 Summary of information from Solidarity Peace Trust, “Discarding the Filth”, 27 June 2005: page 15. This position has not changed much in a year – most forex continues to trade on street corners and cross border trading remains the life blood for many thousands of families, but statistics relating to this are hard to come by since the demolitions: much of the informal sector remains criminalised and cross border trading often involves illegal border crossings and smuggling. 19