DIASPORA Infrastructure Development Group (DIDG), awarded the National Railways of Zimbabwe (NRZ)’s US$400 million recapitalisation tender in a joint-venture with South African railway utility Transnet, says its project will rescue the country from a suffocating economic bypass through Botswana.
BY HAZEL NDEBELE
Speaking to the Zimbabwe Independent yesterday, a day after being awarded a tender which had attracted 88 bidders globally and a shortlist of big international players, DIDG founding executive chair Donovan Chimhandamba said the project was critical to Zimbabwe’s economic recovery and of strategic national importance. He said the NRZ project will help to neutralise a threat posed to Zimbabwe’s economic wellbeing by the bypass development of the 923-metre long Kazungula rail and road bridge network between Zambia and Botswana.
“If you look at the regional infrastructure network, it is absolutely clear that due to lack of investment, Zimbabwe’s rail substructure is now lagging significantly. This has led to numerous infrastructure projects being developed around Zimbabwe to effectively by-pass the country,” Chimhandamba said.
“The Kazungula bridge connecting Zambia and Botswana is set to be completed by 2018 and plans are advanced for the construction of the Kazungula–Francistown railway line. Such developments would have devastating consequences for Zimbabwe and its economy if such projects as the NRZ recapitalisation one are not done urgently.”
Chimhandamba said it was critical that the NRZ project be done as the Kazungula rail and road bridge will provide an alternative route for people, goods and services from South Africa into the interior of the continent, bypassing Zimbabwe — the historical entryway into the region.
Zimbabwe’s southernmost border town, Beitbridge — the busiest inland port of entry in sub-Saharan Africa – is currently the gateway into the region and beyond.
The Kazungula corridor is meant to bypass Beitbridge and Zimbabwe into the region and interior of Africa.
South Africa and other Southern African Development Community (Sadc) countries are developing the new road and rail network to bypass Zimbabwe largely because of its dilapidated infrastructure.
However, the Beitbridge-Harare-Chirundu highway and NRZ projects are designed to address the issue.
The Kazungula development is nearing completion, with the construction of the bridge on the Zambian side now finished. It is a multinational project on the North-South Corridor in the Sadc region, which is part of infrastructure development intended to boost regional integration and trade.
Zimbabwe is the artery and hub of Sadc’s road transport network, linking the Southern African region with the rest of Africa. This was part of colonial tycoon Cecil Rhodes’ Cape to Cairo dream.
The Beitbridge-Harare-Chirundu highway facilitates movement of millions of people and goods between southern, central, east and north Africa.
The country has, however, failed to repair and upgrade its old infrastructure.
A 2001 Sadc assessment of the road infrastructure in the region showed that a third of Zimbabwe’s road network was in a parlous state. The Beitbridge-Chirundu Road was singled out as one of the highways that needed urgent rehabilitation as it was critical for trade in the region.
DIDG, in its tender application, said it would provide US$400 million for NRZ revival.
The parastatal had been seeking a turnaround strategic partner, but a mismatch in its balance sheet largely had kept investors at bay.
The state railway company’s cargo transport business – its cash cow – had collapsed from a peak of 18 million tonnes to 2,8 million tonnes annually largely due to a hostile economic environment, mismanagement and corruption.
NRZ owes its creditors US$144 million, on top of the US$68 million in outstanding salaries, although government has now absorbed the debts.
DIDG group, a wholly owned local entity spearheaded by Zimbabwean diasporans largely based in Johannesburg, South Africa, says it is keen to be part of the country’s reconstruction agenda.
Chimhandamba said DIDG’s principal motive is to assist and collaborate with the Zimbabwean government to unlock foreign capital inflows and technical solutions towards development of the country’s critical infrastructure.
“We are into different projects and we were not formed specifically for the NRZ tender. We have other projects that we are working on. The company’s target sectors include transport, power, energy, water, mining and mineral beneficiation, telecommunication and ICT,” he said.
“If we can modernise our rail, water, road and airports infrastructure, we can radically reduce the cost of doing business not only for Zimbabwe, but for the entire region.
“We are particularly interested in NRZ because if that rail system is working efficiently, it will service important sectors such as mining, agricultural and fuels not just in Zimbabwe, but also in countries like Zambia and DRC, among others.
“The by-pass project being developed by other countries is basically seeing this market opportunity, which market Zimbabwe has lost due to lack of investment.
“We partnered Transnet to ensure we gain long-term access and control of the movements of bulk commodities in the region.”
About 88 firms had expressed interest in NRZ, but the State Procurement Board shortlisted six bidders which included firms from all over the world. So DIDG won the tender ahead of big companies like Sino Hydro, China Civil Engineering, SHM Railways of Malaysia, Croyeaux Limited of Zimbabwe and Crowe Horwath & Welsha.