Zimbabwe faces cash shortage after US cuts foreign aid  

Banks are now struggling to get money, leading to dire effects on many people and businesses in the country which depend on the US dollars to survive, local reports say.

The US has been sending money to Zimbabwe to help with food, health, business, and government programs.

Since 1980, it has given more than 3.5 billion dollars. Every year, the US Agency for International Development (USAID) provided over 300 million dollars. Zimbabwe's banks also depended on these funds, with about 10% of bank deposits coming from international aid.

But on January 20, US President Donald Trump signed an order cutting most foreign aid, a decision that has caused panic in Zimbabwe’s financial system.

Banks use foreign money for trade, loans, and reserves. Without enough US dollars, banks may not have enough cash for customers to withdraw. They may also stop giving out loans, which could slow down business and trade.

Economic analyst Kudzanai Sharara warns that with banks struggling, businesses will find it harder to borrow money, making life even more difficult for ordinary people.

Trade and debt payments could also be affected, adding to Zimbabwe’s economic troubles.

Zimbabwe has used the US dollar for years to keep its economy stable.

In the late 2000s, hyperinflation made the local currency almost worthless, forcing people to rely on US dollars instead. Now, with US aid drying up, the country faces another tough financial challenge.