S.I. Obliging Exporters To Pay For Electricity In Forex Shows How Unwise De-dollarization Was - Biti

1 year ago
Fri, 15 Jul 2022 16:54:01 GMT
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S.I. Obliging Exporters To Pay For Electricity In Forex Shows How Unwise De-dollarization Was - Biti

Citizens Coalition for Change (CCC) vice president, Tendai Biti, has said Statutory Instrument (S.I.) 131 of 2022 which obliges exporters to pay for electricity in foreign currency shows how ill thought was de-dollarisation.

Zimbabwe reintroduced the Zimbabwe dollar in June 2019 and made it the sole legal tender putting an end to the multicurrency regime that was in place since 2009 when Zimbabwe had record-high inflation of 231 million per cent, per official statistics.

The government is reluctant to re-dollarise saying the southern African country has no capacity to fully dollarise amid fears that the move advocated by Biti would trigger serious cash crises as was the case around 2016. 

Biti, a former Minister of Finance and Economic Development during the Government of National Unity (GNU 2009-2-13), believes Zimbabwe would have been better had authorities not de-dollarised. He said:

The regime has enacted SI 131 of 2022 which obliges exporters or partial exporters to pay electricity charges in US$. The measure is yet further proof of the adhocratic & chaotic nature of policy making in Zim. It is proof of how ill thought de-dollarization was.

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Zimbabwe faces an energy crisis arising out of the fact that in 42 years of independence there has not been investment in power generation. The Hwange Thermal Units are archaic & obsolete whilst Kariba has its own challenges. Pushing the cost of lack of gross capital formation to exporters is heavy-handed and ill-thought. Zimbabwe urgently requires fresh 2000MegaWatt power generation and this regime is not capable of overseeing this. The lack of infrastructure development in 42 years captures the incompetency & paralysis of the #ZANU project

Needless to say, Gross Capital Formation and infrastructure development will be a top top priority in a new Zimbabwe. Zim infrastructure is in a state of decay, frozen in a 1950s time machine. An absolute national embarrassment

Making exporters pay for electricity is also reflective of the fact regime has run out of foreign currency. The auction system has been an expensive vehicle of arbitrage & the taps are running dry Yet the same exporters still suffer from the pain of Export Surrender Requirements

The overuse of Statutory Instruments to govern reflects a lack of planning & disdain of parliament. Having 131 SI s in 6 months literal means a Statutory Instrument every 16 hours. Governance by decree is authoritarian archaic & undemocratic. The country requires new leaders.

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