A few weeks ago Zimbabwe secretary of finance George Guvamatanga said the country won’t repeat the mistake of abandoning its own currency. He was adamant that the nation would rebuild on the back of the Zimbabwean Dollar. The local dollar was reintroduced only a year ago, after the country had been using the US dollar as legal tender for almost a decade. The nation was forced to abandon its own currency and adopt a stronger, more stable currency when hyperinflation all but destroyed Zimbabwe’s economy. The county’s power utility has allowed customers to pay their bills in US Dollars. This concession was previously only available to high usage customers like miners but Zesa is struggling to pay for increased imports as it faces drought and breakdowns at major production facilities. – Melani Nathan
Zimbabwe power utility approves payment of bills in US Dollars
By Ray Ndlovu
(Bloomberg) — Zimbabwe’s cash-strapped utility Zesa Holdings is allowing people to pay their bills in foreign currency as it struggles to fund the nation’s power imports.
Zesa said in an emailed statement that the decision would bring consumers more “convenience.” Previously, only miners and exporters were allowed to pay for power supplies in US dollars and other foreign currencies.
The southern African country generates less than half of its own electricity and relies on imports from South Africa and Mozambique for the rest. Local production has been hit by a drought that shuttered the nation’s main hydropower plant and by frequent breakdowns at its coal-fired Hwange facility.
The government has gradually opened more of the struggling economy to foreign transactions since the start of a virus lockdown in March, backtracking on an earlier decision to make the Zimbabwe dollar the sole legal tender. Citizens can now use US dollars for food shopping, fuel, toll fees and passports.
The move has undermined demand for the Zimbabwe dollar, sending its value slumping and it now trades at 81.73 to the US dollar. The utility said the exchange rate from a weekly foreign auction system would be used to settle consumers’ electricity bills.