Pan African Bank to Zim’s rescue

ZIMBABWE’s electricity supply is expected to improve follow a rescue package which involve a leading pan African bank which has a strong presence on the continent and the Reserve Bank of Zimbabwe.

The deal involves a US$15 million guarantee for future supplies through a ring-fenced facility to be serviced by export proceeds was sealed in South Africa

According to the deal, the pan-African bank will act as guarantor of the facility, with local exporting firms required to pay for electricity supplies in hard currency into the ring-fenced account.

The financial institution was recently named best retail bank in Africa 2019 at the prestigious African Banker Awards held in Malabo, Equatorial Guinea. The bank, which has strong presence across 33 African countries that include Zimbabwe, South Africa, Angola, Zambia, Togo, Rwanda Mozambique and Ghana.

This comes as Zimbabweans are currently enduring an average 18 hours a day without electricity because of depressed generation at the Kariba Hydro Power Station where authorities have begun rationing water allocations due to low water levels in the lake caused by the severe drought of 2018/19.

Zimbabwe had enjoyed more than four years without load shedding, but the drought has pushed the Zambezi River Authority (ZRA) to reduce water allocation to the Zimbabwe Power Company from 19 billion cubic meters to less than 16 billion cubic meters for 2019, thus reducing power generation to 358MW for Zimbabwe and 392MW for Zambia.

The rationing is meant to ensure that the plant continues to run until the next rainy season.

Power generation at Hwange and the smaller thermal power stations of Harare, Bulawayo and Munyati remains fragile because of aged equipment.

Last week Fortune Chasi, the Energy and Power Development Minister confirmed that the South African government was considering a proposal put forward to increase power exports to Zimbabwe after high level talks between the two countries’ energy ministers.

Zimbabwe owes Eskom US$27 million, this is after a payment of US$10 million, which it made last month as part of its commitment to pay its debt. Additional power imports from South Africa will ease the prevailing power shortages, which have seen the country embarking on a daily 18-hour electricity load-shedding schedule.