Harare, RBZ in forex tussle 

Source: Harare, RBZ in forex tussle – The Zimbabwe Independent April 26, 2019


A BITTER wrangle between Harare City Council and the Reserve Bank of Zimbabwe over foreign currency allocations is far from over, despite the release of US$150 000 this week by the central bank to the local authority for the purchase of critical water treatment chemicals.


It has emerged that before this latest allocation on Tuesday, the municipality had failed to access forex for the past three months.

Failure to promptly get the foreign currency has exposed the city’s three million-strong population to water borne diseases such as cholera and typhoid as desperate residents have been forced to resort to unsafe water sources.

Before getting the US$150 000, the city raised alarm that it was left with chemicals enough to last only 48 hours and has had to drastically reduce the bulk water it pumps into homes, leaving the majority of neighbourhoods to run dry. Contacted for comment, the Reserve Bank rebutted the city council’s claims, saying it has always religiously honoured foreign currency allocations to the municipality since safe water provision falls under the central bank’s priority list.

Harare town clerk Hosiah Chisango, however, maintained that the local authority was forced to provide only a quarter of the required water supply. Council requires US$3 million per month for a cocktail of nine water treatment chemicals.

Chisango said due to shortages of foreign currency, council was forced to treat only 100 million mega litres of water per day, against the city’s daily demand of 450 million mega litres.

This move had seen the local authority rolling out a water rationing schedule, with some suburbs going for two weeks without piped water supplies.

“Our monthly requirement is up to US$3 million, depending on our production levels. That’s our monthly requirement.

We have been getting that until about two to three months ago; so for the past three months we did not receive the allocation. And the allocation is such that the council should pay for that forex component, by providing the equivalence in RTGS$ so it is not like the RBZ is giving us but they are providing for forex on our RTGS account,” he said.

He also said the inter-bank forex market introduced in February by the RBZ was failing to benefit the local authority.

“There is no money on that facility and we are forced to rely solely on RBZ,” Chisango said.

RBZ governor John Mangudya refuted Chisango’s claims. The Reserve Bank chief said they have disbursed funds to council as per the local authority’s request.

“What Chisango is saying is not true at all. l am in touch with the mayor and the town clerk Hosiah Chisango. He even phoned me yesterday himself. I spoke with them and what they wanted for now was US$150 000 for chlorine which they were given on Tuesday at their request. They also said they have some chemicals still available,” Mangudya said.

Harare relies solely on the heavily polluted and inadequate Lake Chivero as a source of potable water. The lake, located downstream of the city, was dismissed in a 2016 University of Zimbabwe study as a “giant sewer”.

City of Harare requires a tonne of chlorine gas daily, which is used as a disinfectant to kill bacteria in the water. The other chemicals it uses are activated carbon for removing odours, aluminium sulphate, sodium lime for pH regulation, sulphuric acid, calcium hypochlorite for removing algae and ammonia for chlorine retention.