Time's Thomas Marzhal reports on the latest sanction to hit Zimbabwe:
Bowing to a request from the German government, a German company that has been supplying Zimbabwe's embattled regime with bank note paper has stopped its deliveries, further increasing pressure on President Robert Mugabe.
The Munich-based firm Giesecke & Devrient, which reportedly supplies about half the southern African country's skyrocketing needs for paper to print money, made the decision after its president received a phone call Tuesday from German Foreign Minister Frank-Walter Steinmeier.
"We have taken this step in response to an official request from the German government and calls for sanctions on Zimbabwe from the European Union," Heiko Witzke, a company spokesman, said Wednesday.
A Foreign Ministry spokeswoman said that in his call to CEO Karsten Ottenberg, Steinmeier underlined the deteriorating situation in Zimbabwe and the mounting calls for stiffer sanctions on the Mugabe regime. She said the ministry had been holding talks with the company for several weeks.
Will this make a difference?
According to Reuters, no:
"The banking and transacting public should go about their business in the usual manner, as the above-mentioned development will not have any impact to the economy," central bank Governor Gideon Gono told the Herald newspaper....
Gono said the government made alternative plans before the German firm, which supplied Zimbabwe with the special paper for 40 years, announced the decision. He did not give details.
The central bank would "innovate and try to plough around all obstacles placed in its way", he said, although did not say how and where the country would source material to print money.
This sanction is likely not going to change anything -- the elites that matter already have ways of hedging against the current hyperinflation and the people who don't matter have already made their choice. The armed forces have made it pretty clear that they'd be delighted to rough up those who get in their way.
This more, therefore, won't accomplish much except:
- Signal to Zimbabwe that North Korea is dangerously close to overtaking them in terms of openness to the outside world;
- Make Jonathan Kirshner smile.
UPDATE:
Tyler Cowen has more, including this tidbit: "in case you are wondering, it's
the same company that printed up the bills for the famous Weimar hyperinflation of the 1920s."
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