Zimbabwe Alloy Smelting Company (Zimasco) shut down operations on Thursday at its smelting plant in Kwekwe citing viability challenges.
by BLESSED MHLANGA
Zimasco two years ago shut its West plant chrome smelting furnaces and has been operating just two furnaces at its plant owing to depressed global metal prices.
The company switched off the furnaces midday on Thursday putting pressure on its workforce which is already on half monthly salaries.
In a move which was meant to improve viability, the company four months ago fired 645 employees who have added to the long list of its crippling debt.
Sources said the company was struggling to meet its debts owing to depressed profit margins.
Management is reported to have held a meeting with workers this week and told them the company was failing to settle its debts and the purchase of raw material to keep the furnaces going.
“We were addressed and told that the company has too many creditors and they can’t cope with raw materials costs. Management said they were struggling with the power bill especially after sealing an unsustainable $1 million a month payment plan to liquidate the debt,” said the source.
The company is also struggling to get raw material especially pastes which are imported from South Africa.
Pastes are used as battery in the burning or smelting process of ores in the furnaces. A source said the company only has 36 pastes against a requirement of 500 pastes on monthly basis.
Zimasco has also faced serious challenges with the 645 workers who have been picketing the Kwekwe plant demanding their retrenchment packages.
Zimasco workers have not been paid since October and following the closure, all workers have been forced home and will be on half salary until March next year. Attempts to get a comment from Zimasco were fruitless as the company’s phones were not being answered.