HomePolitics. . . As firm gives up mining claims to pay debt

. . . As firm gives up mining claims to pay debt

Augustine Mukaro

ZISCOSTEEL has surrendered its mining concessions to KFW of Germany after failing to repay a US$17,6 million loan advanced for the construction of its s

teel plant.

This follows KFW’s successful claim against Zisco at the International Court of Justice. Zisco finance executive Ben Manyunyire told the Foreign Affairs, Industry and International Trade Parliamentary Portfolio Committee in August that the company was planning to give the Germans mining concessions around Kwekwe after it lost the case.

“On the externals (external debt), the major creditors are KFW of Germany which is almost their central bank which financed the construction of the steel plant. We owe them $17,6 million through Forestal,” Manyunyire said.

“They have since taken us to the International Court of Justice. Discussions have been going on with the Attorney-General’s office and the Ministry of Finance and Ministry of Industry but they went ahead and as of last week a default judgement had been issued in their favour with which they can proceed to attach property.”

Manyunyire said Zisco had to look for alternative ways to ensure that the Germans recovered their money.

“We tried to give them some mining concessions so that they can recover (their loan),” he said. “Whether that option is open, we are not aware but that includes gold mines around Kwekwe.”

Other than the Germans, Manyunyire said Zisco also owed the Chinese for the construction of blast furnace number four.

“In terms of China, there is the China Exim Bank which is being guaranteed by Sinosure Insurance Company,” he said.

“We owe US$4,71 million for the number four blast furnace but these ones we have been carrying on. By early this year, they had come out with a turnaround programme which was a short-term one to do our mills section for value addition so that we could quickly recover and try to pay them back. It is an amount of US$5,5 million. It was very modest. We had actually said US$300 000. We had paid them US$953 000 so that they could do number three furnace.”

Manyunyire said locally Zisco owed the National Railways of Zimbabwe, Hwange and Zesa money on an inter-parastatal arrangement.

“We owe NRZ $88 million and $10 million for Zesa but we can supply these figures,” he said.

During the same tour Ziscosteel workers told the portfolio committee that they were exposed to poor working conditions without basic protective clothing.

“Management will tell you to prioritise and they say we cannot give you all safety clothing,” one worker identified as Mumbi said. “When they say prioritise, they will be saying clothe others and leave others. It is now about five years. People should be given respirators. If you look at our shoes, they are torn and we are told that there is no money.”

Recent Posts

Stories you will enjoy

Recommended reading