By Move expected to worsen Zimbabwe’s economic woes
By Ada Anioji
Fresh trouble is piling up for Zimbabwe’s long-serving President, Robert Mugabe on account of a threat by South African energy giant, Eskom, to cut off electricity supplies to the country over a $44.5m debt overhang.
At the celebration of Zimbabwe’s Independence anniversary in April. Mugabe, who has controlled virtually all of the critical levers of power in the Southern African country since it gained Independence in 1980 had enthused that the country had recorded a major achievement in that power supply had been steady for 15 months running and counting.
But all of that smirking is now being wiped away with the South African state-run power utility Eskom threatening to cut off supplies to Zimbabwe by the end of this month if Harare fails to clear arrears.
Analysts say such a move could trigger widespread power cuts in an economy already battling with a liquidity crunch but which hopes for faster growth this year after rains boosted crop production.
Zimbabwe imports 300 megawatts (MW) per day from Eskom, but owes the utility 603 million rand ($44.5 million), of which 119 million rand is outstanding arrears, the Herald reported. Acute shortages of foreign currency have seen the southern African nation struggle to pay for imports.
The Herald quoted a letter from Eskom’s acting chief executive Matshela Koko telling Zimbabwe state power company ZESA it had failed to stick to an agreed payment plan.
“Kindly note that no further leniency or accommodation will be made in this regard,” Koko was quoted as saying. Officials at Eskom were not immediately available for comment.
Zimbabwe’s imports from Eskom are backed by a 500 million rand guarantee issued by President Robert Mugabe’s government.
ZESA chief executive Josh Chifamba was quoted by the Herald as saying the utility was talking to the central bank about foreign currency allocations and was confident there would be no power disruptions.
On Monday Zimbabwe was producing 1,051 MW of power, with another 350 MW coming from imports, against demand of 1,500 MW.
Comments