While South Africa face a possible downgrade to junk status due to Eskoms implementation of Stage 2 load shedding on Wednesday, Zimbabwe will be facing further power shortages as they will no longer receive enough power from the utility to assist them with their power shortage.
The Southern African nation has a non-binding agreement which allows Zimbabwe to import up to 400 megawatts of power from South Africa, while receiving an an additional 100 megawatts from neighboring Mozambique.
The blackouts in Zimbabwe sometimes last as long as 18 hours a day despite the country spending $23-million a month on electricity imports.
Earlier this month the country increased its electricity tariff by 320% in a bid to increase production and improve supply. This was the second increase in three months, following a 300% increase in August.
The Zimbabwe Energy Regulatory Authority (ZERA) said that the tariff increase was due to the soaring inflation rate.
Zimbabweans were however hit with another blow on Wednesday when bread prices rose by 60% overnight.
The country have also been facing a bread shortage due to the scarcity of the subsidised bread flour which was being imported. Locally produced flour is very expensive and not viable for use by bakers.
Hyperinflation reached 500-billion percent 10 years ago which forced Zimbabwe to scrap it’s own currency. With continued price hikes there is fear of hyperinflation again.
Bakers have had no choice but to increase the cost of bread due to the increased cost of electricity and fuel. As there is only power for around six hours a day the bakeries have had to make use of generators to run the ovens.
The cost of raw materials to make the bread have also added to the increased price which saw bread increase from 9 Zimbabwe dollars to 15 Zimbabwe dollars (approximately US$1)
Workers are angry as salaries do not increase
Most Zimbabwean families are surviving on one meal a day, which often consists solely of bread, but workers are angry as salaries do not increase with the inflated prices meaning that even bread is becoming unaffordable.
Many government workers said they are unable to report for duty as their wages are almost worthless and they can no longer afford to travel as fuel prices increased by more than 25% earlier this month.
Inflation is currently at 290% but economists predict it could double that.