Zimbos fear for the worst

By Tendai Kamhungira

There are growing fears among long-suffering Zimbabweans that the country is on the verge of a complete implosion — after it was confirmed earlier this week that the country is failing to pay its external electricity suppliers.

This comes as stressed banks have also warned that the bond notes introduced last year to mitigate the severe shortages of cash were being siphoned from the domestic market and exported to neighbouring countries, where there was a thriving black market.

Zimbabwe imports electricity mainly from South Africa’s State-run power utility, Eskom, as well as from Mozambique’s Cahora Bassa — to augment its dwindling power generation capacity occasioned by the government’s dismal failure to plan and invest in new infrastructure to improve local electricity supplies.

The government, through Zesa Holdings, owes Eskom and Cahora Bassa a combined $83 million in payment arrears — which has prompted Pretoria to give Zimbabwe a one-week ultimatum to settle an overdue $43 million, or face being switched off.

Opposition parties slammed President Robert Mugabe and his government yesterday for failing to address the country’s worsening cash shortages and their failure to prioritise essential services when allocating foreign exchange.

“No rocket science is needed to appreciate that Zimbabwe is sitting on a political and socio-economic precipice. The economy of this country has been to hell and back. We are in a major crisis.

“Mugabe doesn’t seem to fully appreciate and comprehend the economic disaster that is engulfing the nation. He is living in his own world of make believe.

“He needs help. The MDC reiterates that Zimbabwe is doomed for as long as Mugabe and his Zanu PF gangsters remain in power,” thundered MDC spokesperson Obert Gutu.

Zimbabwe is in the grip of a worsening economic crisis which has also witnessed a severe shortage of cash, including the recently introduced bond notes.

The disappearance of the country’s surrogate currency from the market has also often forced banks to give clients their cash in sackfuls of coins.

It has also seen banks limiting the amount of money both individuals and companies can withdraw, sometimes to as low as $20.

Last Friday, bankers finally broke their silence on the matter and confirmed that Zimbabwe was facing a huge financial crisis which required urgent attention by the government.

Addressing delegates at the Financial Markets Indaba held in Harare, Barclays Bank Zimbabwe managing director George Guvamatanga said bond notes had vanished from the local market and were now big business in neighbouring countries.

“It’s not yet established, but there could be more bond notes at Park Station in South Africa, and in Botswana, Zambia and Mozambique than we have here in Zimbabwe.

“Someone realised there is an opportunity to sell the bond notes to Zimbabweans living outside the country, who then don’t have to come here and queue to withdraw their money from banks.

“At the moment, it’s easier for us at Barclays to give United States dollars than to give bond notes,” Guvamatanga told transfixed delegates. Daily News