HARARE – Finance minister Patrick Chinamasa has claimed that government may be forced to dig deeper into its depleting purse to revive Ziscosteel due to lack of foreign investors.
“Industry minister Mike Bimha and I have been talking about Ziscosteel . . . unless Ziscosteel becomes operational, the country’s economic recovery will not take place,” he told the businessdaily on Monday.
“So, it is important that we should do whatever we can . . . either on our own
resources . . . I have tasked the Industry ministry to tell us the basics and costing required to get Ziscosteel back on stream, so that Treasury can maybe squeeze something towards this,” Chinamasa added.
This comes as Zimbabwe’s cash-strapped government is also making moves to assume the Kwekwe-based miner’s over $370 million debt.
“The rationale is we want to clean the company’s balance sheets and make it
attractive to investors. So work along these lines is now advanced and we hope to wrap up soon,” the Treasury chief said.
Last week, Industry deputy minister Chiratidzo Mabuwa told Parliament that government was in the process of vetting six investors who have expressed interest in the steel mine.
Mabuwa said invitation of expressions of interest had been sent to 29 potential investors and six responses had been received by October this year.
This was after the country’s $750 million deal with Indian firm Essar Africa Holdings (Essar) collapsed last year, with the investor bailing after steel prices plunged 40 percent in 2014.
Zimbabwe signed the multi-million-dollar deal in 2011 to revive Zisco fortunes but the highest level the deal was consummated to was just a name change to New Zimsteel.
At its peak, Ziscosteel was the largest integrated steel works in Africa with a
capacity to produce one million tonnes of the commodity annually, and its demise in 2008 came as no surprise due to Zanu PF government’s chronic mismanagement, corruption and maladministration of the economy.
The company, affectionately known as the heartbeat of the Midlands Province, used to produce over 50 000 tonnes of prime iron and steel and employed over 6 000 workers.
Currently, workers at the company, who have received intermittent salaries over the years, are owed more than $110 million.