Back in 2009, when the world’s richest man was Bill Gates, with a personal fortune of $40,000,000,000, every citizen of Zimbabwe knew that, regardless of exchange rates, one of their brand new 100,000,000,000,000 dollar notes was not enough to even buy a loaf of bread. Suddenly, wheelbarrows full of money were valuable not for the money they contained but for the wheelbarrow itself.
As we all know, the world’s currencies are by no means equal – and some are much less equal than others.
Typically, when currencies begin to lose their value, governments are tempted to issue new bank notes – first adding and then eventually removing zeros on the printed notes. In Europe, over the last 20 years or so, this has happened to Yugoslavia, Turkey and Romania. Currently, it doesn’t take much for you to become an instant millionaire in five countries. In:
- Guinea – $1 buys some 6,675 Guinean Francs
- Laos – $1 buys 8,135 Lao Kip
- Iran – $1 buys 10,671 Iranian Rial
- Sao Tome and Principe – $1 buys 17,244 Dobra
- Vietnam – $1 buys 20,876 Dong
By comparison, officially, $1 currently buys 378.70 Zimbabwean dollars.
With the holiday season soon going to be upon us, if you’re visiting these countries, you need to become familiar with the money very quickly. The best advice is to learn the colour of the different notes because this should be the quickest way to distinguish a 100,000 from a 1,000,000 note without making an expensive mistake.
If, instead of taking a holiday, you’re contemplating doing business with companies in any of these countries, you need to be aware that falling currencies can – and probably will – continue to fall, thus reducing any profit margin in your contract.
Great article.