Govt plans to revive NRZ, Sable

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THE government is making frantic efforts to revive companies regarded as strategic players to the national economy, a government official has said.

TAURAI MANGUDHLA
Business Reporter

The companies include New Zim Steel, National Railways of Zimbabwe (NRZ) and Sable Chemicals (Sable).

Speaking at a Buy Zimbabwe annual conference in Harare last week, Industry and Commerce minister Mike Bimha said plans were at an advanced stage for the resuscitation of the three companies.

The industry minister said New Zim Steel (formerly Zisco Steel) is a major priority as it constituted 60% of NRZ revenues in the southern region at its peak.

He said an official announcement on the way forward and state of affairs at the steel maker should be made in about two weeks.
“Once Zisco is back on line then a lot of companies in Bulawayo will come back to life,” he said, adding so central was the steel maker that some companies in Bulawayo were still open in anticipation of the reopening of New Zim Steel.

“We are almost there. It was not an easy job because there was so much money owed, the investor had to put resources and three furnaces almost need to be replaced.”

Bimha said Sable has been facing challenges due to use of old equipment and technology.

The company still uses an electrolysis method which consumes a lot of electricity and has rendered the operation unsustainable after expiry of energy tariff incentives.

Last week, according to Bimha, Sable made a presentation to government on their revival strategy which includes inviting possible partners.

“The company still needs support and what we are doing is to give them that support as they look to other options such as gas or coal bed methane,” he said.

On NRZ, Bimha said progress had been made on the revival strategy without giving further details.

In an update, the Cabinet minister said statistics showed that Zimbabwe has a competitive gap, with imports expected to grow to $8,32 billion at the end of 2014 compared to $7,8 billion in October 2012.

He said the $8,321 billion import bill indicates that almost 68% of the products consumed locally will be sourced from outside, hence the need to capacitate industry to be able to reduce the import bill and reduce the current account deficit which closed 2013 at $4,5 billion.

Government statistics show the country’s trade deficit in the two months to February declined 9,4% to $495,77 million from $547,26 million in the comparative period a year ago.

The situation is expected to persist until year end as the liquidity crunch bites into the economy.