Treasury to bailout NRZ | Business Times

TANATSWA KANDENGA

 

Finance Minister, Professor Mthuli Ncube, will avail ZWL$56.4bn  to recapitalise  the National Railways of Zimbabwe (NRZ) , Business Times can report.

A thriving NRZ, which is battling a myriad of challenges including ageing railway line, depleted rolling stock fleet and old coaches, among many other crippling problems, is essential to the effort to lessen the strain on road transportation at a time when the lack of a nexus is still negatively impacting the nation’s road infrastructure.

“We have set aside ZWL$56.4bn to recapitalise NRZ,” Professor Ncube said.

He added: “The country’s rail system is becoming a bottleneck to the seamless railway service within the region, given the interconnectedness with other national networks along the Beira/Maputo corridors to Mozambican ports and North-South corridor linking countries in the north and ports in the south such as Durban and Richards Bay in South Africa. Improved rail services support economic growth by lowering transportation costs, particularly for the mining and agriculture sectors, which require bulk transportation of raw materials and finished products.

“Government is also supporting the National Railways of Zimbabwe recapitalization roadmap through access to lines of credit for the procurement of locomotives, wagons, track infrastructure and signaling equipment. The NRZ is also expected to engage the private sector users of the railway system on options for joint ventures.”

Speaking to Business Times, NRZ spokesperson, Andrew Kunambura said: “As soon as we receive the ZWL$56.4bn the work will then begin. The investment of railways will help to improve rail services and uplift economic growth as bulk transportation will be using railway and create easy passage for trade”.

Apparently, bulk consignments are being transported through major highways instead of rail infrastructure.

This has been attributed to the collapse of Zimbabwe’s rail network.

Seven years ago, the government awarded the US$400m tender to recapitalise NRZ to South Africa’s Transnet, which partnered a consortium of non-resident Zimbabweans- the Diaspora Infrastructure Development Group (DIDG).

However, the deal collapsed.

Although, NRZ, required about US$2bn to turn around its fortunes, the US$400m would have helped reposition NRZ for self-sustenance as the rail company’s network provides a vital link between landlocked countries like Zambia, Democratic Republic of Congo as well as seaports in South Africa and Mozambique.

 

 

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