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Zimbabwe: Mozambique Agrees to Resume Power Supplies
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Financial Gazette (Harare)
31 January 2008
Posted to the web 31 January 2008
Kumbirai Mafunda
Harare
MOZAMBIQUE'S Hidroelectrica de Cahora Bassa (HCB), which cut power supplies to Zimbabwe on January 1, has agreed to resume supplies after government agreed to settle the outstanding debt through weekly payments of US$500 000.
ZESA Holdings chief executive officer Ben Rafemoyo, said US$10 million of the debt had been paid off, and was hoping "to resolve our issues with the supplier to restore supplies" into the country, which he said was currently producing half of its own power requirements.
ZESA currently owes HCB US$16 million for power imports. The latest agreement means it will take ZESA at least eight months to fully settle the debt to HCB.
HCB suspended power supplies to the country early this month after ZESA failed to settle an outstanding US$26 million debt by December. The payment problems had made it difficult for Zimbabwe to negotiate a fresh power supply contract with HCB for the current year.
It was however, still unclear if the new deal had resulted in the renewal of the power supply agreement.
The impasse over power supplies had been broken after a government-to-government discussion between Mozambique and Zimbabwe, and payment guarantees from the Reserve Bank of Zimbabwe.
"We have already agreed to ring fence it (debt). We are already servicing it," a source told The Financial Gazette.
HCB has now agreed to increase its power exports to Zimbabwe to 200MW from 100MW.
ZESA, which as of last week was receiving 100MW from HCB, would begin accessing the other 100MW once the vandalised towers, which link Harare and Mozambique, have been repaired.
The same grid is also used for power supplies from Mozambique to neighbouring South Africa and Botswana.
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A ZESA official was optimistic that the power utility would start "wheeling" the 100MW from HCB "soon".
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