World Bank calls for modernisation of NRZ

24 May, 2015 - 00:05 0 Views

The Sunday News

Ngonidzashe Chiutsi Business Correspondent
THE World Bank has called for the urgent mordenisation of the National Railways of Zimbabwe (NRZ)’s rail system to improve the transportation of goods and services in the country.  In an interview with Sunday Business soon after touring Bulawayo companies that included NRZ, World Bank group executive director Louis Rene Peter Larose said the rail transport’s old equipment needed to be replaced so that locally produced goods could be transported efficiently and cheaply.

“It’s important that the rail transport system be mordenised so that it will be more effective and allow Bulawayo and Zimbabwe to become much more competitive. I believe NRZ should be assisted because they stand on a very important corridor that will help the neighbouring countries,” said Mr Lerose.

He said it was unfortunate that Bulawayo was struggling despite having vast infrastructure that was lying idle.

“There is quite a significant number of infrastructure which is idle due to the economic difficulties in the city. I believe Zimbabwe can become an industrial hub because I have seen that people seem to have a lot of ideas and are ready to work and there is a lot of energy and commitment,” said Mr Lerose.

He acknowledged that Zimbabwean industries were in dire need of funding.

“The main message that I get is lack of finance,” he said and added that the World Bank was set to come up with a rescue package for Zimbabwe.

Industry and Commerce Ministry Permanent Secretary Abigail Shonhiwa echoed the same sentiments and said parastatals like the NRZ were critical to the economy.

“The parastatals are key industries which need support. The industry is down and we want to get a number of measures to see what we can do for the industry,” said Mrs Shonhiwa.

NRZ has the capacity to transport 80 million tonnes per annum, but is moving only six million tonnes due to a depressed market and reduced capacity.

Last year the company managed to move 3,8 million tonnes and in terms of recapitalisation NRZ is still in negotiations with the Development Bank of South Africa to avail funds for the revival of its operations.

The rail utility is struggling to attract investment from the private sector because of its poor state of finances as well as a failure to address its ballooning salary debt.

Mrs Shonhiwa said the World Bank officials were in the country to get an appreciation of the situation before they could assist the country.

“They are partners and can help us with funding,” said Mrs Shonhiwa.

She said Zimbabwean companies had potential to do well with necessary support.

“We have been to the public and private sectors and we visited one company (Archer Clothing) which is doing well. In January there were no jobs and in April they had 500 workers and they told us by the end of the year they would have 850 jobs. They are not only selling locally but exporting as well, it’s an example of what can happen if the companies get the necessary support,” she said.

Archer Clothing resumed operations on a large scale with the company significantly increasing its employment numbers after a takeover by Harare-based Paramount Garments.

The firm exports to Mozambique, Namibia, Botswana, the Democratic Republic of Congo and Malawi as well as Germany.

 

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