Price hikes suspended
The government of Zimbabwe has suspended a 36 per cent rise in electricity prices pending a review into the impact of the hike on consumers. The Zimbabwe Electricity Supply Authority (Zesa) had claimed that price rises were necessary to restore its financial viability.
The government has instructed Zesa not to implement the increase until the cabinet has reviewed the increases which were unpopular with industry and consumers.
Other industries have been forced to freeze prices.
Zesa stated that the move was needed to meet cost increases caused by devaluation of the Zimbabwe dollar, high interest rates and inflation. Zimbabwe imports half of its power requirements and the fall in value of the dollar last year has increased Zesa`s costs.
Zesa also plans further price rises in 1999. The Zimbabwe dollar lost over 40 per cent of its value last year, and fell again in 1998, forcing the government to raise interest rates.