Financial Gazette (Harare)
Staff Reporter
21 February 2008
Harare — MOZAMBIQUE has restored electricity supplies into the country after Zimbabwe settled part of its debt with Mozambique's state-run electricity utility.
Reports from Mozambique say ZESA Holdings had pledged to pay US$16 million it owes Cahora Bassa in six months, adding that the local power utility had paid US$10 million in January after Cahora Bassa switched off power for non-payment.
"The important documents of this agreement were signed during the first week of February, in which Zimbabwe promised to settle the debt with our company in a six-month period, at the same time paying their monthly bills," Cahora Bassa chief executive officer, Paulo Muxanga, said.
After non-payment, Mozambique's power utility halved its power supplies to Zimbabwe to 75 megawatts in mid-December, but terminated supplies on December 28 because ZESA had still not made the payment.
The Financial Gazette reported in August last year that Zimbabwe's power supply situation remained precarious, despite a US$40 million deal signed with NamPower of Namibia, for the refurbishment of the Hwange Thermal Power plant.
NamPower has since written off the loan.
The loan write-off was occasioned by the volatile economic and political climate experienced in Zimbabwe, and indicated NamPower's fear that ZESA would be unable to repay the loan according to terms agreed between the two parties.
NamPower signed the US$40 million loan agreement and added another US$10 million at the end of 2007 to help refurbish the Hwange Thermal Power plant.
The deal, described by NamPower then as "one of the best supply deals ever secured by the company in the interest of the country", involved a firm power supply agreement in terms of which the Namibian power utility would receive electricity from Hwange, as early as this month.
Firm electricity exports to Namibia would be increased on a pro-rata basis once Hwange rehabilitates all its units.
NamPower will then start receiving firm supplies amounting to 150 MW with effect from July 2008 for a minimum of five years.
It could not be immediately confirmed if Zimbabwe, currently grappling with acute electricity shortages, had started exporting the power to Namibia.
Power outages have devastated industrial, mining and farming operations across Zimbabwe, costing the economy billions of dollars in lost revenue.
Be the first to Write a Comment!
Copyright © 2008 Financial Gazette. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
