DBSA bailout for struggling NRZ

THE GOVERNMENT says it has engaged the Development Bank of South Africa (DBSA) to provide $450 million for the rehabilitation of railways and procuremhent of rolling stock as a way of addressing some of the challenges besetting the railways sector.

Business Reporter

Transport and Infrastructure Development deputy minister Petronella Kagonye made the disclosure last Friday while addressing legislators and stakeholders attending a Zimbabwe Agenda for Sustainable SocioEconomic Transformation (ZimAsset) seminar held in the capital recently.

Kagonye said the National Railways of Zimbabwe (NRZ) required $450 million for recapitalisation.

“Discussions with DBSA, who funded a feasibility study of the various requirements by NRZ in 2011, are progressing well,” she said.

Kagonye said the NRZ and the ministry were pursuing railway development plans targeting specific routes such as Lion’s Den to Chirundu and Kafue, Harare to Nyamapanda and Moatize in Mozambique, Kadoma to Sengwa Railway, Mkwasine to Mutare, Mvuma to Pounsley and Mutare, Intundla to Zisco, Buchwa to Bikita, Beitbridge to Bubye Coal Fields and Harare to Chitungwiza.

At its peak, NRZ used to ferry goods in excess of 18 million tonnes in 1998. It has gone down to 3,7 million tonnes as of 2011.

NRZ currently has only 65 locomotives, 3 271 wagons and 158 coaches that are functional against a requirement of 83 locomotives, 4 262 wagons and 145 coaches.

According to the parastatal, $2 billion is required for the rehabilitation of the railway lines in the country over a 10-year period.

The NRZ was allocated $2,8 million to refurbish its locomotive power and rolling stock in the 2014 budget.

DBSA has been helping the country with funds for various projects that include the Infralink road construction where it invested over $200 million in the construction of the road. The project is a partnership between Zimbabwe National Road Authority and Group Five where the Plumtree-Bulawayo-Harare-Mutare highway is being rehabilitated.

Meanwhile, Kagonye said 57 companies have expressed interest in projects and tenders that will be awarded between March and June this year.

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