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Zim facing power supply crisis
01/02/2004 16:45 - (SA)
Harare - Zimbabwe's debt-stricken power supply utility faces a crisis as South African and Mozambican utilities demand up- front payment for supplies, the state press said on Sunday.
Last week, Eskom switched off electricity to the Zimbabwe Electricity Supply Authority (Zesa) for two days because of non-payment.
Meanwhile, Mozambique's Hydroelectrica Cahora Bassa had cut its supply to Zimbabwe by 40% since the end of last year, the state-controlled weekly Sunday Mail reported.
Zesa's finances have gone from bad to worse since January 2000 when it failed to meet payments to neighbouring countries after hard currency earnings slumped with accelerating economic decline.
Widespread blackouts
Widespread blackouts, that would worsen the country's already devastated productive sectors, have been avoided only by President Robert Mugabe's appeals to President Thabo Mbeki and Mozambique's President Joaquim Chissano to intervene with their power utilities.
Since then, Zesa has been able to keep going through soft credit deals agreed to by Eskom and HCB.
The Sunday Mail reported that Zesa's annual contracts with Eskom and HCB ran out on December 31, and both were now demanding payment in advance.
Zesa's total bill to African utilities and to international financial institutions now totals $410m, the Sunday Mail said.
Eskom is apparently willing to renew its contract as a result of new tight fiscal and financial policies promised by recently appointed Zimbabwe central bank governor Gideon Gono.
Zesa is a major casualty of Zimbabwe's economic crisis, marked by the fastest shrinking GDP in the world - 40% in four years - and the highest inflation, now at 60%, as well as famine for the third consecutive year in which 7.5 million Zimbabweans - about 60% of the population - are facing starvation. - dpa
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