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| Congo Zaire currency - 1 Zaire = 100 Makuta banknote, President Mobutu |
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| world paper money - Congo Zaire - 1 Zaire = 100 Makuta note |
African Banknotes
Congo 1 Zaire = 100 Makuta banknote 1970 President Mobutu Sese Seko
Congo 1 Zaire = 100 Makuta banknote 1970 President Mobutu Sese Seko
National Bank of Congo - Banque Nationale du Congo
Obverse: Portrait of President Mobutu Sese Seko in military uniform at right. Kinshasa stadium at center left. BNC - Monogram of the National Bank of Congo at left.
Reverse: Mobutu's "time to work" to gathering of people at left center - A young Joseph Désiré Mobutu rolls up his sleeves during a speech in December 1965 in Leopoldville, Congo.
Watermark: Antelope's head.
Printed by Thomas de la Rue, London, England.
Congo Republic Banknotes
1967-1971 Issue
Mobutu Sese Seko
Mobutu Sese Seko Kuku Ngbendu wa Za Banga ( born Joseph-Desiré Mobutu; 14 October 1930 – 7 September 1997) was the President of Democratic Republic of the Congo (which Mobutu renamed Zaire in 1971) from 1965 to 1997.
Installed and supported in office primarily by Belgium and the United States, he formed an authoritarian regime, amassed vast personal wealth, and attempted to purge the country of all colonial cultural influence while enjoying considerable support by the United States due to his anti-communist stance.
During the Congo Crisis, Belgian and CIA-backed forces aided Mobutu in a coup against the nationalist government of Patrice Lumumba in 1960 to take control of the government. Lumumba was the first leader in the country to be democratically elected and was killed by a Katangese firing squad; Mobutu soon became the army chief of staff. He took power directly in a second coup in 1965. As part of his program of “national authenticity”, Mobutu changed the Congo's name to Zaïre in 1971 and his own name to Mobutu Sese Seko in 1972.
Mobutu established a single-party state in which all power was concentrated in his hands. He also became the object of a pervasive cult of personality. During his reign, Mobutu built a highly centralized state and amassed a large personal fortune through economic exploitation and corruption, leading some to call his rule a “kleptocracy”. The nation suffered from uncontrolled inflation, a large debt, and massive currency devaluations. By 1991, economic deterioration and unrest led him to agree to share power with opposition leaders, but he used the army to thwart change until May 1997, when rebel forces led by Laurent Kabila expelled him from the country. Already suffering from advanced prostate cancer, he died three months later in Morocco.
Mobutu became notorious for corruption, nepotism, and the embezzlement of between from US$4-15 billion during his reign, as well as extravagances such as Concorde-flown shopping trips to Paris. Mobutu presided over the country for over three decades, a period of widespread human rights violations. As such, he has been described as the "archetypal African dictator".
Zairean Zaire
The zaïre was the unit of currency of the Democratic Republic of the Congo and then of the Republic of Zaire from 1967 until 1997.
The zaïre (symbol: "Z", or sometimes "Ƶ") was introduced in 1967, replacing the Congolese franc at an exchange rate of 1 zaïre = 1000 francs. The zaïre was subdivided into 100 makuta (singular: likuta, symbol: "K"), each of 100 sengi (symbol: "s"). However, the sengi was worth very little and the only sengi denominated coin was the 10 sengi coin issued in 1967. Unusually for any currency, it was common practice to write cash amounts with three zeros after the decimal place, even after inflation had greatly devalued the currency. Inflation eventually caused denominations of banknotes up to 5 million zaïres to be issued, after which the new zaïre was introduced.
In 1967 the Congolese franc was replaced by the zaire, a nonconvertible unit with a value of US$.50 to the zaire. This exchange rate held good until March 1976 when the zaire was revalued to Z1.1 to the SDR. A succession of devaluations in 1978, 1979, 1980, and 1981 temporarily gave the zaire a realistic value, but, because the fixed link with the SDR was retained, the black market quickly took over again as the principal market for exchange. A few exporters, notably Gecamines and other governmentowned companies as well as the offshore oil consortium, normally observed the official exchange rate, a policy that inevitably had an adverse impact on their cash flow because the local currency they were paid was considerably less than the real value of their foreign-exchange earnings.
The overvaluation of the zaire led to consistent shortages of hard currency at the official rate, making it difficult for local industries to import necessary inputs and spare parts. This limitation and restrictions on repatriating profits by overseas investors gave rise to a black market where the zaire sold at a fraction of its official value. For example, the parallel rate stood at five times the official rate in September 1983.
The parallel rate was the principal currency vehicle for business. Recorded diamond exports dropped sharply as smuggling offered a considerably higher profit margin than operating officially. Diamonds were sold at one point by nondiamond-producing Burundi. Coffee exporters were required to present their export documents to official channels in order to register their allocated percentage of Zaire's international coffee organization quota. However, it was common practice to ask bankers to deliver foreigncurrency receipts to another customer, who would then pay the exporter zaires at the parallel rate minus a commission. Some exporters simply smuggled coffee to neighboring countries. Access to limited and grossly undervalued foreign exchange depended on political and family connections. In this way, many members of the Zairian elite gained easy access to hard currency, as opposed to those Zairians and foreigners engaged in more entrepreneurial pursuits.
Throughout the early 1990s, the Zairian government accelerated its attempts to acquire hard currency and to control foreignexchange transactions. In October 1993, the regime required all Zairian exports to be paid for in advance in foreign currency. In addition, all incoming foreign exchange had to be "sold" to the central bank for domestic currency within forty-eight hours of receipt.
In terms of the United States dollar, the zaire has registered a dramatic decline in value since 1985, when Z50 equaled US$1, and 1986 when Z60 equaled US$1. The average annual value of the zaire per US$1 was registered as Z112 in 1987, Z187 in 1988, Z381 in 1989, and Z719 in 1990. The zaire was devalued in August 1991 in order to match the official exchange rate with the black-market rate, resulting in a new official rate of US$1 = Z15,300. But in 1992 the rate plummeted to US$1 = Z114,291 and continued to deteriorate. The official rate was Z1,990,000 = US$1 by December 1992 (the average annual rate for 1992 was Z645,549 = US$1).
In January 1993, the regime attempted to introduce a new Z5 million note. But opposition forces denounced the move as inflationary and encouraged merchants to refuse to accept the note. When many of them did so, soldiers who had been paid in the notes went on a rampage, and extensive rioting and looting occurred. By March 1993, the exchange rate was Z2,529,000 = US$1.
In October 1993, the regime again attempted to resolve its chronic liquidity crisis by announcing the introduction of a new zaire (nouveau zaire--NZ), each supposed to be worth 3 million of the old zaire and set at an official rate of three new zaires to the United States dollar; the old currency was to be withdrawn from circulation. The change had not been implemented by the end of 1993. The result of the announcement alone has, however, been a drastic plunge in the exchange rate in the black market and another surge in prices. The zaire traded against the United States dollar at a seemingly ridiculous rate of 8 million to one in October 1993; by December the rate was a patently absurd Z110 million to the dollar and still rising. Once again some rioting and looting occurred when opposition forces promoted a boycott of the new currency.