Will ZESA tariff hike translate to more power?
THE Zimbabwe Energy Regulatory Authority (ZERA) on Wednesday approved an electricity tariff increase of $162,16c per kilowatt hour, following a recent application by power utility ZESA Holdings to adjust the charge to promote viability and better service delivery.
This follows, the application to increase the power tariffs by ZESA Holdings, through its subsidiary, the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), from 38,61c/kWh arguing that the previous rate had been eroded by the movement of macro-economic fundamentals.
Consumers definitely are still in shock from the hike of the average electricity tariff by 320 percent because they are already grappling with soaring inflation which is eroding their salaries.
This is the second time the price of electricity increased inside three months and follows sharp rises in fuel and basic goods prices in the last week, yet salaries have not kept pace.
Electricity tariff increases will have a direct hostile effect on the cost of living and the country’s ability to create jobs, considering that those who are currently gainfully employed are already struggling to make ends meet.
With new tariffs, consumers would want to be assured that efficiency in power generation and distribution will improve so that they go on with their businesses without power cuts.
Over the past years, ZESA’s inefficiency has led to a shambolic power generation and distribution network which has many leaks and the recent tariff increase will not address the anomaly.
Reports point out that ZESA technical losses of power chew up to about 300MW.
Moreover, it is alleged that the introduction of prepaid meters has worsened the faulty billing system with reports that about US$10 million is lost every month.
ZESA management should be honest with the situation on the ground for them to be able to solve the existing problems once and for all.
All over the world, it is common knowledge that if electricity tariffs are increased, there is a higher probability of an interest rate hike as the inflation outlook will accelerate outside the target band.
In simple terms, it means higher cost of local products and services.
What Zimbabweans pray for is that the tariff increase will at least translate into availability of electricity for both domestic and industrial use.
The industry is literally warped because of power outages posing a major risk to the country’s economy.
On the other hand, increased inflation as a result of additional tariff hikes will further constrain the economy’s ability to grow and create the millions of jobs unemployed Zimbabweans so desperately need.
Experts argue that the increase may make some marginal industries economically unviable and affect service delivery at municipalities, telecommunications and engineering sectors.
Zimbabwe is said to be generating less than 631MW from its four power stations against a daily peak demand of 1 800MW in winter and 1 600MW in summer.
Generation capacity at Kariba hydroelectric plant has tumbled below 200MW from 1 050MW at peak while Hwange Thermal Power Station is producing 421MW.
Additionally, Harare and Bulawayo power stations can only manage a measly 34MW due to archaic equipment constraints. This means that even after importing 400MW from Eskom and 100MW from Mozambique there is still a power deficit of 600MW at any point in time.
What this means is that Zimbabweans will continue to be subjected to high electricity tariffs for years to come, unless ZESA comes up with a cheaper electricity solution.
ZESA should embrace solar energy which has the potential of making electricity cheaper and end power shortages.
Even if the tariffs keep hiking, power outages will always be with us unless the power utility addresses the challenges on the ground like improving on infrastructure and revenue collection.
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1. INTRODUCTION
1.1 Zimbabwe’s Land Reform Programme of 2000 led the United States of America (USA) to impose illegal and unjustified sanctions under the so-called Zimbabwe Democracy and Economic Recovery Act (ZIDERA) of 2001. Supplementing the US’ legislative sanctions of ZIDERA are Executive Sanctions (Executive Order 13288) of March 2003 renewable on a yearly basis. The European Union (EU) also introduced its own sanctions in February, 2002.
1.2 While the EU lifted much of its sanctions in 2014, political sanctions against the former First Family, Senior Government officials, the country’s Service Chiefs and Zimbabwe Defence Industries are still in place. The sanctions also include travel bans and asset freeze for Zimbabwean officials and companies. The EU insists that it will maintain the sanctions under constant review in light of political and security developments in Zimbabwe.
1.3 Far from the claim that sanctions are ring-fenced and targeted on a few individuals, the reality on the ground is that the tight grip of the declared and undeclared sanctions is being felt throughout the whole economy.
1.4 These punitive measures have effectively hampered the Government’s efforts to implement its development agenda.
2. EFFECTS ON THE ZIMBABWEAN ECONOMY
2.1 The sanctions generally have resulted in devastating effects on the whole economy of Zimbabwe.
Access to credit lines / Decline in
BoP Support
2.2 Zimbabwe’s Balance of Payments (BoP) position has deteriorated significantly since the introduction of sanctions.
2.3 Zimbabwe’s access to international credit markets was blocked after the enactment of ZIDERA. The country has been forced to virtually operate on hand to mouth, and there has been a significant build- up of external debt arrears. This unfavourable development has worsened the country’s creditworthiness as the country’s international financial risk profile escalated.
2.4 This subsequently led to the drying up of traditional sources of external finance from the International Financial Institutions (IFIs), with the country receiving no support from the African Development Bank since 1998, the International Monetary Fund (IMF) since 1999 and the World Bank since 2001. In essence, the
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The sustained decline in longterm capital inflows has had ripple effects on the country’s employment levels, and its ability to provide basic goods and services to its people, ultimately leading to a decline in the standards of living. This resulted in the country suffering from de-industrialisation and, subsequently, stagnation effects.
N this month of October, the Breast Cancer Month, this article unpacks more about the dreaded disease. Knowledge is the mainstay of how one may handle themselves if and once diagnosed. It is a long journey which one walks alone.
What is breast cancer and what causes
it?
Anyone with breast tissue is at risk of breast cancer and as such it is important that everyone becomes breast aware, taking note of any abnormalities in their breasts.
Early detection of abnormalities may be the difference between surgery and gruelling treatments to fight the cancer, and less traumatic treatments.
Breast cancer is a malignant tumor. Put simply, it is a collection of cancerous cells located in the breast tissue. Although breast cancer predominantly occurs in women, it can also affect men.
There is no real known cause of breast cancer except that it occurs when a cell’s DNA is damaged. There are risk factors, though, which are attributed to it, such as age, genetics, previous breast cancer/lump, taking excess alcohol, and obesity.
In Zimbabwe, it is the second largest cancer that affects women . . . the nurturers and carers of families. Globally less than two percent of men get breast cancer.
How do you detect breast cancer?
1. To find out if your breast has lumps which might point to cancer, women espeIFIs stopped their support to Zimbabwe by instituting a number of suspensions on Balance of Payments support, technical assistance, voting and related rights by the IMF, and declaration of illegibility to access fund resources.
Arrears Triggered Penalties cially are encouraged to do self-examination (looking and feeling the breasts often) or visit health facilities and be examined by qualified health personnel. (N.B. Not all tumors in the breast are cancerous).
2. If a lump is discovered, then there are follow-up tests that have to be carried out to help detect cancer as listed below:
a) This first type of test, known as a mammogram, is done by X-ray and is the initial screening for breast cancer. It produces images that can help the radiologist detect any lumps or abnormalities.
b) If the results of the mammogram are suspicious then the radiologist will do an ultrasound scan which is a test that uses sound waves to help the doctor determine between a solid mass and a fluid-filled cyst.
2.5 Due to Zimbabwe’s failure to honour its financial obligations to the IMF and World Bank since 1999, the Bretton Woods institutions suspended Balance of Payments support and technical assistance. Consequently, the country’s external payment arrears continually increased from US$109 million in 1999 to US$5,4 billion in 2017. The arrears have been rising, now at more than 70 percent of total public and publicly guaranteed external debt.
2.6 Regrettably, the lending programme from the World Bank is inactive due to accumulated arrears and sanctions. With effect from October 2000, the World Bank placed all its International Bank of Reconstruction and Development loans and International Development Association credits to, or guaranteed by, Zimbabwe in non-accrual status, resulting in the country being unable to access any loan.
2.7 The combined effect of the arrears situation and sanctions has resulted in Zimbabwean companies finding it extremely difficult to access offshore lending, thus, crippling their operations. Pre-sanctions era, loan inflows to Zimbabwean companies increased from US$134 million in 1980 to US$480 million in the 1990s but fell significantly to an average of US$80 million between 2000 and 2008. Currently, where the private sector manages to secure offshore financing it is usually at punitive and exorbitant interest rates.
2.8 Moreover, Zimbabwean importers are asked to pay cash upfront resulting in a significant squeeze on private sector cash flows. This has led to bigger challenges, including under capacity utilisation of
3. A more advanced and detailed test, a Magnetic Resonance Imaging (MRI), may be recommended as a follow-up to a mammogram or ultrasound scan at times.
The results from these tests are taken to a surgeon who will then do a biopsy on the tissue that is suspicious. The biopsy is a process where the doctor draws out a sample of the tissue which is sent to the laboratory for analysis.
The results from the laboratory analysis show whether or not the cells are cancerous and hormone sensitive as well as the type of cancer.
Breast Cancer Treatment Where there is presence of cancer then treatment plans are laid out taking into consideration factors such as the size of the lump, Zimbabwean companies. Due to declining external budgetary support, Zimbabwe’s budget deficit has largely been financed from domestic borrowing which has triggered high inflation.
Sustained Decline in Long-Term
Capital
2.9 The sustained decline in long-term capital inflows has had ripple effects on the country’s employment levels, and its ability to provide basic goods and services to its people, ultimately leading to a decline in the standards of living. This resulted in the country suffering from de-industrialisation and, subsequently, stagnation effects.
2.10 Consequently, there has been large-scale emigration, especially of skilled labour. Two to four million Zimbabweans are estimated to have emigrated to mainly South Africa, the UK, Botswana, the USA, Canada, Australia and New Zealand. This has further strained the human resource capacity to hasten the pace of economic turnaround and development through brain drain.
Impact on the Financial Sector 2.11 Due to the absence of Balance of Payments support, Zimbabwe’s Balance of Payments position has been deteriorating significantly since the imposition of sanctions. The sanctions have branded Zimbabwe and its entire financial linkages with the rest of the world as high risk, thereby making the country a compelling target for de-risking interventions by lending correspondent banks in the USA and Europe. In 2016 alone, 19 de-risking cases were recorded in 10 of the local banks.
2.12 In the same year, the US’ Treasury Office of Foreign Assets Control (OFAC) fined a Zimbabwean commercial bank US$2,48 million to resolve potential civil liability for 159 alleged violations of the sanctions regulations for transactions that took place between July 2008 and September 2013.
2.13 In 2017, another commercial bank was slapped with a staggering US$3,8 billion fine by OFAC for facilitating transactions on behalf of a bank which was then specified institution under ZIDERA. The penalty was only reduced to US$385 million after mitigation and negotiations.
2.14 Another bank had funds in all foreign bank accounts and in transit from or to clients frozen, while all contracts and business relationships with US citizens and corporates were abrogated.
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To be continued on website: www. herald.co.zw age, overall health, hormone sensitivities and even individual preferences.
Surgery
The doctors can choose to take out the lump (lumpectomy) or to remove the whole breast (mastectomy) via surgery. Mastectomy is usually done where the cancer has spread to what are known as sentinel lymph nodes.
If cancer is noted in the lymph nodes generally in the armpit, then there are high chances of it spreading to other parts of the body through the lymphatic system.
To deal with the traumatic psychological effects of mastectomy, the breast can be reconstructed to give a more natural look to the patient.
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