Zimbabwe warns of severe power cuts amid forex shortages

Zimbabwe's power utility on Monday warned the country could experience massive load shedding due to lack of foreign currency to pay for power imports from neighboring countries.

ZESA Holdings is currently importing electricity from South Africa and Mozambique to offset a power deficit.

Chief executive Josh Chifamba told a parliamentary committee on mines and energy that the power utility was getting less than half of its weekly foreign currency requirements from the Reserve Bank of Zimbabwe (RBZ), news agency New Ziana reported.

Following biting cash shortages in the economy, the RBZ has taken responsibility of mobilizing foreign currency for institutions which require funding for foreign international transactions and is now prioritizing critical national imports.

"We are being given 1.5 million U.S. dollars per week where we require 5 million dollars," said Chifamba.

"We are, as we stand, having some arrears on both accounts which are Eskom of South Africa and Hydro Carbora Bassa of Mozambique."

Chifamba said the power utility had come up with innovative strategies and was making arrangements with some customers to augment the allocation from RBZ.

"We are talking to our customers in the export business so that they cede to us part of what they retain from their export proceeds so that we can help alleviate this problem," he said.

He warned that should the shortage of foreign currency persist, the utility may embark on massive load shedding.

Zimbabwe's ageing power plants, built before the country's independence from Britain in 1980, are producing on average 1,000 MW, leaving a deficit of 400 MW that it imports from neighbors. Endit