Exporters will now have to pay Zesa in foreign currency, the Reserve Bank of Zimbabwe (RBZ) ordered yesterday in a statutory instrument, and Zesa can only use that foreign currency to pay for electricity imports, spare parts or critical equipment, foreign loan repayments and foeign insurance premiums.
Even exporters that export less than 80 percent of their output will still have to pay 35 percent of their electricity bills in foreign currency, although they can pay the whole lot in forex if they want to and the Zimbabwe Energy Regulatory Authority and the RBZ have to approve.
Zesa has to keep all these payments in a special foreign currency account, which is strictly limited and used for the four approved purposes, and must in any case have written approval from the RBZ to spend even one US dollar.
The new regulations are contained in Statutory Instrument 249 of 2019, titled Exchange Control (Payment for Electricity and Related Services in Foreign Currency by Exporters and Partial Exporters) Order, 2019.
SI249 was made in terms of the Exchange Control Regulations, 1996, and had the approval of the Minister of Finance and Economic Development.
While the statutory instrument mentions US dollar and Euros by name it says any other foreign currency can be used. All forex payments must be made from the nostro account holding retained export earnings or from a foreign currency account containing free funds. This, in effect, bars companies from using black market funds.
The combined nostro accounts of all exporters have reached very high levels as account holders are reluctant to sell on the interbank market for as long as possible but this statutory instrument should help to ensure more of those retained earnings are used as well as helping Zesa access the foreign currency it needs for legitimate approved payments.
While partial exporters must pay 35 percent of their bills in forex, they can pay the whole bill in forex, but in that case there must be a contract or memorandum of agreement and that has to be submitted to Zera and the RBZ prior to implementation. The same need for advance approval of a contract is required where a customer wants to pay in forex in advance.
The regulations are valid for six months from yesterday unless earlier renewed for another period not exceeding six months.