The ManicaPost
Kudzanai Gerede Business Correspondent
The recapitalisation of National Railways of Zimbabwe (NRZ) has been hailed as a major stride in the resuscitation of the economy with industry expected to reap massive benefits from a revived railway transport system, industrialists have said.
This follows the successful joint bid by Diaspora Infrastructure Development Group, a consortium of Zimbabwean investors living abroad, and South African investor, Transnet, who will finance the parastatal’s US$400 million recapitalisation initiative.
The NRZ has been struggling to operate profitably owing to deteriorating rail infrastructure which affected operating efficiency and a decline in utilisation following the contraction of the country’s industrial base which presented brisk carrier business for the railway liner.
The parastatal is also saddled with a US$144 million legacy debt.
The recapitalisation initiative will focus on acquisition and upgrade of wagons, upgrading the company’s information technology and signalling systems as well as increasing the parastatal’s capacity utilisation.
Industrialists have welcomed Government efforts to revive the ailing giant not only as pivotal in creating an efficient transport system for the local economy but also key to redeeming the country’s status as the SADC transport hub connecting major economic centres across the region at a time economies were moving towards regional economic integration.
In a telephone interview, Grain Millers Association chairman Mr Tafadzwa Musarara told Post Business that an efficient railway transport system would make local industry more competitive comparared to haulage truck usage.
“Our railway system have been the biggest let-down for the local industry in terms of competitiveness of the final product on the market. An efficient railway system provides a cheap carrier alternative and we are happy with what Government has done to revive the NRZ which used to be the pride of the country across the region.
“As millers we are happy that transportation of grain will be cheap and more efficient and that is good for business,” added Mr Musarara.
This was echoed by PPC Zimbabwe managing director who said the absence of a vibrant railway system was worsening the company’s transport costs.
Government is seized with revival of strategic parastatals since last year with the hope of complementing industrial development and last November secured 31 state-of-the–art wagons for the NRZ from China Railway Rolling Stock Company.
Recently, Transport and Infrastructural Development Deputy Minister Engineer Michael Madanha told Parliament that Government was in talks with the Russia Import-Export Bank over a Us$ 10 million loan facility that will yield 100 wagons from Russian wagon manufacturer Uniwagon.
