HomeLocal NewsGovt mulls Ziscosteel revival

Govt mulls Ziscosteel revival

GOVERNMENT has set up an inter-ministerial taskforce to spearhead the revival of the defunct steelmaker, Zimbabwe Iron and Steel Company (Ziscosteel).
The decision was made at a cabinet meeting on Wednesday last week.


The taskforce, chaired by Industry and Commerce minister Sekai Nzenza, includes Finance and Economic Development minister Mthuli Ncube, Energy and Power Development minister Fortune Chasi and Mines and Mining Development minister Winston Chitando.

According to official sources, it was also resolved at the meeting that the Special Economic Zones Authority (Zimseza) would second an official to the taskforce.

“Cabinet decided to set up a taskforce to spearhead the revival of Ziscosteel at its meeting on Wednesday last week. The decision came after minister Nzenza outlined a plan for its revival. So, following a discussion over the best way forward, it was decided that establishing a taskforce would be the best foot forward,” an official said.

Sources further said the taskforce would start operating next week. It will report its preliminary proposals to cabinet within three weeks.
“It was agreed that the taskforce should start working on the issue on June 1 and report back in three weeks. Basically, they are going to inquire on what is needed to bring the factory back to life following so many years of inactivity. They will have to report back to cabinet in three weeks outlining their findings, covering aspects like how much is required not to refurbish the plant, courting the most suitable investors and related matters.”

A 2006 parliamentary inquiry established that the Redcliff-situated plant was brought to its knees by grand looting spearheaded by government ministers and other senior officials. However, the report was never published.

Several previous efforts to revive the massive steel manufacturer, which at its peak employed more than 5 000 people, have yielded no fruit, mainly on account of bureaucratic woes and allegations of corruption.

Last year, a US$1 billion deal with Chinese company Guangzhou R&FA to resuscitate Ziscosteel collapsed after the government changed its shareholding offer to the company’s president, Zhang Li.

The Chinese billionaire, a real estate mogul, had been willing to start work on the collapsed steel giant and progress had already been made in procuring some equipment.

At first, Guangzhou R&FA was offered 100% shareholding in the steelmaker, but the government later changed to it to 48%. The Chinese team did not like the new deal.

In January 2018, President Emmerson Mnangagwa promised that Ziscosteel and Shabani Mashaba Mines would begin operations within his first 100 days.
There has, however, not been activity at the two entities, which used to provide thousands of jobs and other downstream benefits to the economy at their peak.
Ziscosteel officially closed its gates in 2016 and laid off its remaining workers without terminal benefits.

Most of its infrastructure, equipment and spares have either been vandalised or looted or become obsolete over the years.

In 2006, Indian firm Global Steel Holdings Limited courted Ziscosteel and wanted to inject US$400 million in a rehabilitate, operate and transfer arrangement, but the deal suffered a stillbirth.

In 2011, Essar Africa Holdings’ bid to take over the firm in a deal worth US$750 million also hit a brick wall due to bickering in the then inclusive government comprising three political parties Zanu PF, MDC-T and MDC.

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