this week as the Central Bank governor said the plan would probably take until February 2015 to implement, two years longer than the governor said last year.
The idea of dropping excess zeroes has been bruited about for many years. It moved front and center in the fall of 2009 when Central Bank Governor Mahmud Bahmani said a study had recommended slicing off three zeros.
That later changed to four zeros. And on Sunday, the cabinet formally—and very belatedly—adopted the plan to carve away four zeros.
Bahmani then sowed confusion by saying it would take around three more years to bring about the change or until February 2015.
But in April of last year, Bahmani said it would take at least two years to knock off any zeros, or until April 2013.
Ten days prior to that, Bahmani said the shift would take “one to two years.” And five days before that, he said he would present a full proposal for making the currency change to the cabinet “within the next six months.”
In other words, every time Bahmani talks about lopping off zeroes, the completion is extended still further out into the future.
Bahmani gave no explanation for the constantly changing timetable.
Bahmani did at least stick with the intention to drop four zeros from the rial, converting 10,000 rials into one rial. He announced the four-zero drop in April of last year—changing from the three-zero drop he announced in September 2009 after what he described as a long study by the Central Bank.
The shifting of implementation deadlines and the number of zeros to be dropped telegraphs considerable confusion within the Central Bank on what is really a rather minor issue with no impact on monetary policy. It begs the question of whether there is equal confusion on more important matters that could impact the economic health of the state.
At the official rate of exchange right now, one rial is worth 8 thousandths of one US cent. The difficulty of dealing with a currency where one unit is a measure of worthlessness rather than of value was demonstrated last week when President Ahmadi-nejad introduced to the Majlis his budget totaling 5,100,000,000,000,000 or 5.1 quadrillion rials.
