In East Africa, the Zanzibar Electricity Corporation (Zeco) has made a move to clear its outstanding debt with Tanzania Electric Company Limited (Tanesco), local media Daily Nation reported.
This follows after Tanzania’s President John Magufuli recently gave orders for Tanesco to grant Zanzibar’s defaulters a 14-day grace period until it disconnects them from the country’s power grid. Read more…
It is reported that Magufuli issued the directive while laying the foundation stone for the new Tanesco substation in Mtwara.
He also insisted that all public institutions should clear their debts or be disconnected.
The President added that the directive also applies to the State House in Dar es Salaam in order to press the responsible officials to clear the Tanesco debts, saying the company needs the money to survive.
Zanzibar pledges to continue paying
Media reported the Tanzanian energy and minerals minister Sospeter Muhongo revealed that Zanzibar has started to repay its debt.
Prof Muhongo disclosed the payment after Zanzibar President Ali Mohamed Shein met President Magufuli at State House in Dar es Salaam, media reported.
The two presidents held talks in the presence of minister Muhongo and Tanesco’s acting managing director Kahitwa Bishaija.
It is reported that the government of Zanzibar has paid Tsh10 billion ($4 million) as the initial settlement of the accumulated Tsh121 billion ($9 million) it owes the Tanesco in power tariffs.
Grace period closing
Minister Muhongo also reminded all defaulters to pay their outstanding bills within five days, or risk power disconnection, media stated.
In 2016, Tanesco asked for Parliamentary Accounts Committee’s support to recover the debts, with the Zanzibar government accumulating its bills since 2013. Read more…
At the time,Tanesco’s former managing director, Felchesmi Mramba said: “We really need urgent assistance in collecting the debts, especially the Zanzibar one, which is so huge and still growing.”
Zanzibar’s debt originate from the difference in tariffs between Zeco and Tanesco, with Zeco charging lower tariff than Tanesco, and ultimately collecting significantly less than what Tanesco charges.
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