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SA firm eyes Zim railways
SA firm eyes Zim railways

SA firm eyes Zim railways

FMCG SUPPLIER NEWS - Aug 26th 2014, 11:11

Harare - Zimbabwe’s dilapidated rail infrastructure may soon have a facelift following indications by a South African firm, Grindrod Limited (Grindrod), that it was seeking commodity contracts outside its home market. 

Alan Olivier, the Grindrod chief executive, last week said his company was more than ready to invest in the southern African region.

“We are looking at big projects, very capital-intensive projects in neighbouring countries. They will have to open up. Grindrod is keen to participate,” he said.

While South Africa is investing about $19, 6 billion in infrastructure, to boost the transportation of commodities including iron ore and coal, poor railway networks hamper neighbouring countries.

Olivier noted that the Durban-based Grindrod plans to invest in Mozambique, Zimbabwe, and Zambia, the continent’s second-largest producer of copper.

The latest indications from Grindrod comes at a time when calls are being made by various stakeholders for government to take drastic action in an effort to save the country’s rail transport system from extinction.

Over the past few years, the Zanu PF-led government has failed to solve the series of operational challenges that have made commuter and goods train services rare in the country.

The National Railways of Zimbabwe (NRZ) — a parastatal mandated to refurbish and services the country’s rail system — is currently saddled with a myriad of challenges ranging from a deteriorating rail-line measuring 1 900km, aging signalling infrastructure, locomotives and wagons.

The company has 168 locomotives with the latest aged 45 years old while its life expectancy is between 20 to 25 years. The railway company also has 8 600 wagons, of which a mere 3 500 are still in use. The wagons have also outlived their use-by date, with most now over 50 years old.

The NRZ has been getting funds from the Public Sector Investment Programme but this has been a drop in the ocean compared to its requirements.

Last month, Obert Mpofu the Transport minister told Parliament that the NRZ was making monthly losses amounting to $17 million and owed its workers $36, 1 million.

The perennial loss-making entity, which used to be one of the best railway companies in southern Africa before Zimbabwe’s economic decline that started a decade ago, is seeking more than $10 billion injection to resume normal operations.

“The $10 billion is what we need all in all but in the short term we could do with about $400 million for about three years to start normal operations,” said NRZ general manager, Lewis Mukwada.

Recently, the national railway company retrenched more than half of its workforce, and its current major challenges are lack of funding, obsolete equipment, and lack of rail-line maintenance.From © 2014 Associated Newspapers of Zimbabwe (Pvt) Ltd. All Rights Reserved. 

Read more about: zambia | mozambique | harare | grindrod limited

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