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Cablegate: Increasing South African Leverage Over Zimbabwe

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS HARARE 000675

SIPDIS

STATE FOR AF/S
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER
USDOC FOR 2037 DIEMOND
PASS USTR ROSA WHITAKER
TREASURY FOR ED BARBER AND C WILKINSON
STATE PASS USAID FOR MARJORIE COPSON

E. O. 12958: N/A
TAGS: ECON EINV ETRD ZI
SUBJECT: Increasing South African Leverage over Zimbabwe
in Electrical Power

Ref: a) Harare 79 b) Harare 643 c) Harare 489

1. (SBU) Summary: Zimbabwe's growing dependence on South
African energy - and diminishing ability to pay for it -
renders the southern neighbor infinite leverage here.
End Summary.

2. (U) Domestic power generation is in shambles, mostly
due to coal-miner Wankie Colliery's dilapidated state
(refs a/b). Depending on the source, Zimbabwe now
imports 40 percent of its electrical energy. Reportedly,
60 percent of these imports come from power giant ESKOM,
and the remainder from Mozambique's Cahora Bassa, the
DRC's SNEL and Zambia's ZESCO. If these numbers are
correct, ESKOM now supplies 24 percent of Zimbabwe's
power.

3. (U) Regional energy companies, and especially Cahora
Bassa, have cut exports to an increasingly delinquent
Zimbabwe. As a result, most Zimbabwean industries have
begun to suffer power rationing. While not yet as
critical as the ongoing fuel and food crises, company
reps tell us the energy crisis is becoming worse each
day. GOZ attempts to persuade exporters to pay in U.S.
dollars have made no impact (ref c).

Comment
-------
4. (SBU) We understand parastatal ESKOM has been more
timid than other power companies in coaxing the insolvent
GOZ to address arrears and has thus far maintained its
power supply at near normal levels. It is not clear to
us what signals the RSA has been sending to ESKOM, but
its adoption of a position paralleling that of Cahora
Bassa would have a major effect here. Purely on economic
grounds, however, we suspect ESKOM's magnanimity has its
limits, although we defer to Pretoria for more nuanced
insight. Unless the GOZ reassesses policies that are
obliterating Wankie and many other companies, a more
severe energy shortfall is likely.

Sullivan

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