State-Controlled ZESA and ESKOM Power Utilities Frustrating Free Market Philosophy 

Open-Ed

  • Zimbabwe and South Africa share a common destiny to electricity supply Armageddon.
  • Both Southern African neighbours and traditional trade partners are currently reeling from unprecedented power shortages, with the scourge looking like it is not dissipating any time soon.

At least South African power consumers are a shade luckier because they have a largely communicative institution and democratic governance. ESKOM spokesperson Sikhonathi Mantshatsha was at pains to de-bunk his boss’s ‘accurate’ doomsday prediction. Chairman Mpho Makwena foresaw how that country would labour under load shedding well after election year 2024. Now, that is not good news for the ruling party African National Congress (ANC), who have to contend with opposition juggernaut Democrat Alliance (DA) for the heart and soul of South African voters. The DA and most neutral South Africans have blamed high-level corruption, incompetence and central government meddling for the demise of ESKOM which is now talking about routinely taking off the grid almost 4000 megawatts of power. If that will not cripple South Africa’s economy, nothing else will.

However, in Zimbabwe, state-controlled power monopoly ZESA is run by ruling party praise-singer Sidney Gata, a brother-in-law to the late authoritarian dictator Robert Mugabe. The ruling ZANU.PF government has presided over systematic collapse of the power utility, originally with installed capacity of 2,000 megawatts and now providing a fraction of that on the national grid. Power outages and load shedding in Zimbabwe are not announced but spontaneous occurrences. ZESA does not even respect its own load shedding schedules. Consumers can only complain in silence or simply buried under State propaganda sludge of false promises. Unlike its counterpart in South Africa, popular opposition party Citizens Coalition for Change (CCC) is not allowed to demonstrate. The last time CCC supporters attempted to defy President Emmerson Mnangagwa’s military junta, we ended up with 20 dead bodies in the streets of Harare. Given the proximity of elections, it is only a suicidal CCC supporter who can even dream of doing the rounds with a #ZesaMustFall banner.

Even though the real cost of load shedding is yet to be computed, if the situation is not arrested, the two neighbours will soon be counting their losses in billions. Both Zimbabwe and South Africa practice a semblance of free market economics. Manufacturers and service providers thrive on innovation and competition. It is a free market that drives prices down and pushes quality up. But for this to prevail, there must be a conducive infrastructural environment presided over by a sensible liberal government. The bottom line is no free-market economy can thrive where electrical power supplies are inconsistent, worse still, run by corrupt and incompetent state-controlled entities. It may take time, but when our economies finally collapse, it will be impossible to retrieve both these trade-dependent neighbours from the abyss.

In my book entitled ‘My Freedom is Not for Sale – the Vagaries, Vices and Evils of State Control’, I dedicate all the 256 pages to emphasising why state control of companies destroys economies. State controlled enterprises are the first frontier; the paragon of public corruption and underhand deals. The governing parties in Zimbabwe and South Africa ZANU.PF and ANC and the surrogates they engage in running and supplying materials have no commitment to cost-effective power distribution. Theirs is an opportunity for plunder and self-enrichment. The only reason why ZESA and ESKOM executives and their suppliers are not in prison is because they are protected from prosecution by those that benefit from corruption.

Compared to South Africa, Zimbabwe’s economy is very small. Between the time Kariba HEP station was built in the 1950s and now, we should have been talking power generation capacity well above 3000 megawatts. Considering abundant coal reserves that Zimbabwe boasts; add the railway infrastructure left intact by Ian Smith’s colonial government – thermal power production would have by now up and running literally in every major town. Bulawayo, Kwekwe and Harare’s thermal power stations are literally mothballed only because coal haulage capacity of the once vibrant National Railway Zimbabwe was decimated by state-inspired corruption. Just to prove how uncommitted Emmerson Mnangagwa’s government is to this crucial energy value chain. Only a few days ago, he appointed an 81-year-old former liberation comrade and retired colonel Tshinga Dube to the NRZ board. This is the same Mr. Dube who runs another state-controlled entity – Zimbabwe Defence Industries – that was recently issued with a licence to export raw lithium ore when the government had just trumpeted a ‘no raw lithium export’ decree.

We keep hearing industrial pundits on both sides of the boarder boasting that our countries are at the front row of the 4thindustrial revolution driven by artificial intelligence. Our very own Southern Africa tech son, Elon Musk has been making waves brandishing the merits of his Starlink satellites and how they will transform Africa’s broadband industry. Only recently, a tripartite 3D concrete printing housing project between South Africa’s departments of Science and Innovation; Human Settlements and the University of Johannesburg showcased importance of industrial advancement. Zimbabwe is equally mulling a cyber city under the tutelage of United Arab Emirates Mulk International a stone throw from Harare.

It is only free markets were cyber technology and artificial intelligence can blossom, but these require good old alternative current power. Liberal economists have long argued for the ‘intervention’ of independent power producers or outright privatisation of both ESKOM and ZESA. Radical leftist elements in both ANC and ZANU.PF may see the rationale of privatisation, yet thoughts of losing the feeding troughs hardens their attitude towards privatisation. Ironically, even so-called enlightened opposition parties argue against privatisation on the basis that it encourages the looting of state assets to the lowest bidder. For now, Southern Africa citizens will have to bear the long hours of load shedding and eerie darkness.

Author: Rejoice Ngwenya

Rejoice 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. The views expressed in the article are the author’s and not necessarily shared by the members of the Foundation.

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