Farmers electricity debt rises to $180 million in four years

Source: Farmers electricity debt rises to $180 million in four years | The Financial Gazette July 3, 2017

ZIMBABWE’S power utility says the country’s farmers are reluctant to pay for electricity and have accrued $180 million in unpaid bills since 2013.

Zimbabwe Electricity Supply Authority (ZESA) which has been struggling to recover over $1 billion in unpaid bills was last month issued about $600 million worth of Treasury Bills to settle debts owed by parastatals and local authorities which accounted for the majority of the debt.

“We have seen that people in the agriculture sector are very reluctant to pay their bills. For us to be able to have a stable power supply we need them to pay. As we speak, the sector owes us $180 million and it accumulated from 2013 when they got that debt relief,” said Zimbabwe Electricity Transmission and Distribution Company (ZETDC) managing director Julian Chinembiri at the ongoing Zimbabwe National Chamber of Commerce (ZNCC) annual congress.

In the run up to the 2013 elections President Robert Mugabe’s government directed the power utility along with local authorities to scrap off debts.

Chinembiri said the ZETDC had proposed use of stop orders and prepaid metres to curb the accumulating debt, but it had been declined by policy makers.

Central bank deputy director for economic research, Samuel Tarinda who was present at the same meeting said the Agricultural sector’s contribution to Gross Domestic Product (GDP) had dropped to 13 percent from 30 percent.

“The Reserve Bank, together with the banking system, have been supporting agriculture in terms of financing. When we look at the outstanding credit at the moment, about 16 percent of total credits currently goes to the agriculture sector directly, we would like to see that percentage grow again. In 1996 it was about 35 percent and now it is 16 percent,” said Tarinda. – The Source