Zimbabwe said Monday that China plans to cancel $40 million in debts as the southern African country seeks to expand use of the yuan in its multi-currency economy.
“They (China) said they are cancelling our debts that are maturing this year and we are in the process of finalising the debt instruments and calculating the debts,” Minister Patrick Chinamasa said in a statement.
Chinamasa also announced that Zimbabwe will officially make the Chinese yuan legal tender as it seeks to increase trade with Beijing.
Zimbabwe abandoned its own dollar in 2009 after hyperinflation, which had peaked at around 500 billion percent, rendered it unusable.
It then started using a slew of foreign currencies, including the US dollar and the South African rand.
The yuan was later added to the basket of the foreign currencies, but its use had not been approved yet for public transactions in the market dominated by the greenback. Read more