The escalating cost of Zimbabwe and South Africa’s independence

Rejoice Ngwenya is the founder and Executive Director of the Coalition for Market and Liberal Solutions (COMALISO) in Zimbabwe, and a contributing author for the Free Market Foundation. COMALISO works for a Zimbabwe that respects the free market, property rights and constitutionalism. 

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This article was first published on Mail & Guardian on
24 August 2022 

The escalating cost of Zimbabwe and South Africa’s independence
Between the 1980 and late-1990s, it was unthinkable that Zimbabwe would experience electrical power outages. What with the country bound by two of Africa’s largest hydro-electric power HEP stations nestled along the majestic Zambezi River, it seemed Zimbabwe’s capacity utilisation would only be incapacitated by an unlikely tragedy.
In the north lies Kariba Dam, itself a world wonder incepted by the then Federation of Rhodesia and Nyasaland; designed by engineer Coyne et Bellier and commissioned in 1960, with installed nominal capacity to supply 1600 megawatts of power. The liberation war did interfere with the construction value chain of additional facilities, but by 1980, all was set to propel the newly independent Zimbabwe to the heights of industrialisation – having now been accepted in the family of free global nations. In the east lies Cahora Bassa HEP, commissioned in 1974 shortly before Samora Machel’s FRELIMO overran the Portuguese garrisons to set up a communist government in Maputo. Due to Mozambique’s smaller economy, this power station played a key role in satisfying the power deficits of its economically hyperactive neighbours.
As time progressed, Zimbabwe expanded its mining, industrial, agricultural and commercial capacity, all of which necessitated enhancing or supplementing Kariba’s power supply. Attention was focused on thermal units in Hwange, the coal mining hub flung a few hundred kilometres from Victoria Falls; and similar units stationed in Bulawayo, the midlands town of Kwekwe (Munyati) and of course Harare. Towards the end of the 20th century, the then President Robert Mugabe was getting complacent of, and uncomfortable with, new democratic culture having enjoyed unprecedented one-party paradise since 1980. Life’s lessons have taught Africa that there is no good economics that comes from bad politics. Although the state-run Electricity Supply Commission (ESC) had inherited impeccable maintenance systems from Rhodesia, Mugabe’s Zimbabwe Electricity Supply Authority (ZESA) was eroded and corroded by nepotism, corruption and outright Mafia-like executive thuggery.
South Africans today understand what this results in. ESKOM, the almost 100-year-old state owned power utility has blossomed into more than 40 subunits, with a current generation capacity of more than 200 000 gigawatts. On paper, it is difficult to understand why such capacity fails to satisfy South Africa’s power demands. The country is currently experiencing one of its worst power deficits in living memory. Just like in ‘independent’ Zimbabwe, the ruling African National Congress party ignored, if not fueled the cronyism that corroded ESKOM’s impeccable management thrust. In Zimbabwe, ZANU-PF trumpeted and blurted dozens of ‘mega deals’ that were intended to replace ageing generators. Millions of dollars have been paid to Malaysian and Chinese companies as thousands of material contracts are channeled to companies with close ties to the ruling party.
At one time, ZESA was the best go-to companies for electrical engineers, but antagonism, greed and an inefficient human capital system excommunicated thousands of world class engineers to New Zealand, Australia, and other destinations. Electricity subsidies meant to pacify ‘new farmers’ who benefitted from Mugabe’s notorious ‘fast track land reform program’ in 2000 means ZESA operates on sub-economic tariffs that make it impossible to re-capitalise the ailing power giant. In an environment that is already suffering from hyperinflation, those few industrial and mining companies brave enough to remain have to bear with crippling load shedding. Current President Emmerson Mnangagwa dreams of turning Zimbabwe’s mining sector into a multibillion-dollar industry, but that is a bridge too far what with a power utility operating at fifty per cent capacity. Ruling party politicians are quick to brag that the country’s all-weather friend, South Africa, will always step in to quench our power deficits. However, this is a fallacy because Zimbabwe not only owes its neighbour millions in unpaid power bills, but also South Africa has its own power deficit nightmares.
Only a few weeks ago, South African President Cyril Ramaphosa presented a grim face on national television networks, reassuring skeptical South Africans on ‘alternative power arrangements’. Power analysts in the region argue that Zimbabwe and South Africa’s ‘state governance model’ does not allow competitive practices in that sector. For instance, Zimbabwe has for years ‘encouraged’ independent power producers IPPs to channel excess power into the national grid. However, this has been frustrated by the central government’s determination of the tariff at which ZESA should buy, much to the chagrin of IPPs. There are also unresolved structural issues in that the ZESA board is controlled by a ruling party crony who is quick not to just divert tenders to party cronies, but also channel millions of United States dollars into ZANU-PF’s political programs – like ‘rural electrification’ and ‘command agriculture’. The billions of local RTGS bond currency declared as ‘revenue’ by ZESA have no capacity to quench the state-controlled company’s thirst of multibillion dollar infrastructure needs denominated in foreign currency.
Meanwhile, power analysts say ESKOM is not short of infrastructure, but it has been disabled by a huge financial black hole traced to state capture culprits Guptas. The company has a woeful maintenance system and failed to extricate itself from ‘command economics’. I have always argued that our countries’ obsession with state owned enterprises deprives our economies of free market competition. To place a country’s entire energy production and pricing in the hands of politicians is a catastrophe waiting to happen. Yes, we may be politically independent, but the cost is becoming too heavy to bear. I am not saying we should return to colonialism, no. I insist that we should borrow from the past that which made our power corporations models of excellence in Africa. 

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