The Sunday Mail
THE National Railways of Zimbabwe (NRZ) is on its knees and can only be resuscitated by a comprehensive recapitalisation by over US$2 billion to buy locomotives, rehabilitate rail and clear debt running close to US$150 million.
The parastatal’s board chair, Mr Alvord Mabhena, says the NRZ is as good as dead.
Asked if the NRZ problems were due to maladministration, Mr Mabhena absolved management of any wrongdoing.
He attributed the malaise at the company to rampant vandalism and general poor economic performance.
“Well, I wouldn’t jump to that (incompetence), but it is lack of investment; that is the main thing. To get capital you need to move traffic and that requires a functional economy.
“Most of the industries that use the railways to move goods are not functional, some have scaled down and some have closed altogether – mining, agriculture, and others – most of those industries are almost dysfunctional.
“So it is a lack of investment. Everything that was there had gone for years unattended; whether you talk of equipment, systems, infrastructure, human capital; all these things have gone to a state of almost dysfunction.
“Equipment was vandalised and literally the organisation is almost on ground zero now. So we hope to embark on a major, major long-term recapitalisation exercise so that NRZ is able to carry the economy of the country,” said Mr Mabhena.
Independent estimates say the firm requires US$2 billion to replace its fleet which has since outlived its lifespan.
The NRZ board chairman assured that Government was committed to commit funds towards revitalising the ailing parastatal. Government has previously indicated that it will raise US$250 million for recapitalisation.
“The recapitalisation programme we are engaged in is all inclusive. It has encompassed all the players and has huge investors.
“I can’t preempt (the figures involved) because it will include what will be derived from the Government initiative. It is a matter that Government is still seized with and once they finish, they are going to make known the position,” said Mr Mabhena.
Mr Mabhena warned that NRZ would remain with salary arrears until recapitalisation was complete.
“We have to resuscitate railways so that we generate revenue and be able to pay not only salary arrears but the debt we need to service,” he added.
Indications are some workers have not been paid for nine months, and money is also owed to Zimra and fuel suppliers. Though Mr Mabhena declined to reveal the figures, details at hand show a debt of around US$144 million.
In the first quarter of 2014, the company generated US$44 million against expenditure of US$61 million.
The entity has long been struggling to stay afloat and managed to move 3,6 million tonnes of goods in 2013 against a target of six million tonnes. It moved 18 million tonnes in 1998.
The NRZ administers about 3 400km of rail, with about a tenth of that under speed restriction due to the poor state of infrastructure while the electrified Gweru-Harare link has been decommissioned due to vandalism.
