africa Economy Energy Finance Infrastructure Mozambique Zambia Zimbabwe

Zimbabwe pays Mozambique debt, Zambia defaults

Approximate reading time: 2 minutes

The Chief Executive Officer of Mozambique power utitity Electricidade de Mocambique (EDM), Mateuas Magala, has announced that the Zimbabwe Electricity Supply Authority, ZESA, is paying off its debt to EDM.

Magala was quoted by state-controlled Radio Mozambique as saying ZESA is paying off the debt to EDM in the form of equipment rather than cash by next Sunday, and that EDM expects to receive 200 new transformers from ZESA in part payment of the debt.

“In all, ZESA should send EDM 500 transformers in order to pay off the debt completely”, Magala reportedly said.
ZESA owes Mozambique’s Hydro Cahora Bassa (HCB) US$10 million, raising fears among stakeholders that the figure could balloon to unprecedented levels witnessed four years ago if it is not cleared on time.

Cahora Bassa

Zimbabwe’s economy is struggling from a devastating drought and crippling cash shortages, and consumers are struggling to pay utility bills for power and water supply.
In 2016, ZESA struggled to clear the $76 million it owed the Mozambican power utility.

Mozambique’s HCB, which suffered from decades of neglect and lack of investment, currently provides 60 percent of its power to South Africa’s Eskom and 35 percent to ZESA. Mozambique consumes the remaining 5 percent, and only 15 percent of the country’s 20 million people have access to electricity.

However, according to Magala, ZESA’s $10 million debt was not very worrying and that, in total, EDM’s clients owe the company about $100 million of which the Zambian electricity company, ZESCO, owes $57 million.

“We have been trying to recover the debt from ZESCO for about two years”, said Magala, who went on to praise ZESA which, unlike the Zambian company, he continued, “was making a serious effort to pay off its debt to EDM”.

Source: Journal du Cameroun

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