HARARE – Government has granted national project status to the $3 billion Beitbridge-Chirundu highway dualisation project following months of protracted negotiations.
The dispensation, approved last week Friday, paves way for the project’s financier, Austria-based Geiger International (Geiger), to start moving equipment into the country duty free.
Transport and Infrastructural Development minister, Joram Gumbo, told the Daily News in an interview yesterday that he was informed of the latest development by the Office of the President and Cabinet (OPC) last week.
The OPC superintends the State Procurement Board, which assesses all government tenders in consultation with the Zimbabwe Revenue Authority in terms of import tax.
Legally, only projects which are awarded national status enjoy the duty exemption privilege as a cost cutting measure.
The preferential treatment also exempts the project’s contractors from paying other taxes.
Gumbo said the development, which has cleared bureaucratic hurdles, would allow the main contractor, Geiger, to move equipment currently stuck in neighbouring Zambia into Zimbabwe.
“I received communication from the OPC that the project has finally been granted national project status. We have been waiting for this for too long but now we are happy everything has been sorted out and construction work can begin,” said Gumbo.
“Government recognises the importance of the project and tax concessions have been granted.
“The national project status will enable duty free importation of eligible products, which include components and materials that form a permanent part of the finished product.
“There is also exemption from non-residents’ tax on fees payable in respect of any services of a technical, managerial, administrative or consultative nature,” he said.
He added that he has since informed Geiger of the development and the contractor to come up with a list of equipment which it intends to bring into the country for approval.
“I have since advised the contractor that what is now needed of for them to draw up a list of the equipment which they hope to move into the country for onward submission to the SPB,” he said.
Last year, government signed a 25-year long $3 billion Build-Operate-Transfer deal for the construction of the highway; one of southern Africa’s busiest.
The deal was signed between government and a contractor, Chinese firm China Harbour Engineering Company Ltd, with Geiger as the financier.
The road, which is narrow and characterised by dangerous potholes, is long overdue for upgrading as it has become a death trap due to the accidents occurring almost daily.
In May, President Robert Mugabe officiated at a ground-breaking ceremony for the road, but construction work was yet to kick off due to bureaucratic issues.