State power utility ZESCO has agreed in international arbitration in London to pay Maamba Collieries Ltd $518 million by August to settle arrears outstanding arrears for power supplied.
Maamba through its parent company Nava has been pursuing international arbitration against ZESCO for outstanding debt.
The arbitral tribunal has issued a consent award, and as per the award, ZESCO shall, by August 2023, discharge the outstanding and overdue arrears aggregating to about $518 million.
“This is a consent award issued by an international arbitration tribunal based in London,” Sultan Baig, chief financial officer at Nava.
This award means that both the parties, Maamba Collieries and ZESCO, have agreed on bilateral terms on how the debt will be disposed of over the next course.
According to the settlement agreement, the money due to Maamba will come in tranches.
As per the Consent Award, ZESCO shall, by August 2023, discharge the outstanding and overdue arrears aggregating to about $518 million as at 31st October 2022 after adjusting for a cash discount of $60 million, extended by Maamba.
As part of the award, ZESCO is mandated to discharge the VAT liability of about $70 million forming part of the total arrears directly to the government.
The Consent Award is an international award for all purposes and validates the long-standing arrears from ZESCO.
The settlement has been reached in an amicable manner to address the overdue power purchase bills while the monthly payments for power sales from May 2022 are being realized in full.
“ZESCO has agreed that the entire money will be settled towards the end of August 2023. It will come to a designated escrow account. Out of this $518 million of outstanding receivables, about $70 million will go towards the payment liabilities of the government of Zambia. “From the balance, over $220 million will go for the repayment of the outstanding overdue principal amount to the lenders. Balance amount will be available with the company and the board will take a suitable decision when the right time comes for the utilization of this fund,” he explained.
The balance overdue receivable will be $227 million, which is net of tax.
ZESCO state owned – Zambia v Maamba Collieries Ltd Zambia agree to settle arrears because a court in London said so. Ushe what is wrong with us kansi? So this load-shedding has deeper roots?
My question is Who Causeed this debt
And hasnt this company been trying for years to get a settlement
But we chose to buying votes in the name of enpowerment
Let get the facts straights
The indians are laughing at us all the way to the bank again………….
……….power shortages……….abundant coal……….building a coal powered power station is a no brainer.
ZESCO or GRZ should have had atleast 50% shares in that power plant……
This is what the president alluded to when in the USA……….that most of that borrowed money would have been used for power generation had UPND been in power instead of roads and more roads…….
But instead the hapless utterly corrupt lungu and PF preferred to be paying millions in wages every month to PF cader thugs and uneconomic roads as bribes……..
Hindsight is a good position to just talk anyhow….UPND is the ruling party and is repeating the same mistakes. This colleriery was laying dilapidated and closed down for years..no Zambian business persons wanted to invest they would rather buy buses and trucks.
You wonder how an exporter of electricity like ZESCO can rack up half a billion in debt…last time before the pandemic I read there was a debt of less than 100 million….why can we have an honest transparent audit of ZESCO finances for the last 20 years it seems there is too much waste and bankrolling of ruling parties.
I have a group of friends running a power company out of some African island country after relocating there when their setup failed to take off in Zambia. Their complaint was unreasonable, political arrogance when they were processing their business operation under the PF government. They complained of spurious demands, freebies after the fact (borrowed cash not returned or flatly denied to be paid back, etc.). This is why they end up running to foreign court jurisdictions to have their matters settled, these politicians would even overrule judicial actions. “I won’t pay. Take it anywhere!” Is a typical arrogant retort,
There is too much political interference even if the money is set aside at ZESCO for debt some minister will misappropriate it…how many times did we hear IDC borrowing from ZCCM immediately it got individends or announced profits? IDC has never paid back that money it just disappeared.
If that was the case then this government has it’s priorities wrong. We have a new government in place but no change in the interference. One would argue that it’s actually getting worse because now we have foreign interference.
Our Country has been losing alot of money and resouces because of tupidity,ignorance and bad leadership when will this nonseness end in Zambia Lord please help us by giving us leaders after your own hear those who will lead us with knowledge and understanding, we have been mislead for too long now its enough.
A small company makes half a billion dollars, but ZESCO the giant monopoly fails to make a Ngwee in profit? What is wrong with a munthu? It is like Bill Gates owing his house servant money!
Yet they used to tell us maamba has problems with spares that’s why it is failing to supply meanwhile all along zesco was failing to pay that’s why they were not supplying. Lies have short legs. So they used to get power on credit at huge cost so that we don’t have loadshedding prior to elections in order for them to come back so that they can hammer a 200% increment to repay after winning. All PF schemes and ploys are now coming to the fore. Imagine how much we would have suffered if they had come back.
Ba PF cadres, the question here is, ” who took this debt on our behalf”? it you, PF.
Zambia. Ichalo chafipuba. Ilyo mwaikalila ukutuka abama PhD. Your friends in the western world use them for advice and solutions. How can a country solely rely on people with apprenticeship degrees from UNZA to run a country? You even end up with people like Lusambo. Do you guys know how far $518 million can go in a small economy like Zambia? Bushe kushama kwashani?
PF need to be arrested and executed. ZESCO does not have to accept this judgement in London. All foreign court judgement are suggestive. ZESCO can bring this matter back to a Zambian court and get a binding decision.