NRZ deficit hits US$300m

gorden_moyo as govt mulls liberalisation
HARARE - The government is considering opening up the railway network to private players, says State Enterprises and Parastatals Minister Gorden Moyo (pictured).

The move could put an end to the National Railway of Zimbabwe (NRZs) monopoly as it is drowning in a ballooning $274 million deficit of depleted fleet and recapitalisation costs.

Moyo said, We are currently devising various strategies of recapitalizing the railways sector. Opening up the railway network to private players has been identified as one of the possible means to revive the sector.

He added that a committee comprising of officials from the State Enterprises Restructuring Agency (SERA), Ministry of Transport and the NRZ board had been set up to formulate viable strategies to resuscitate the ailing sector.

A committee has been set up to look into possible options of reviving the sector, he said, adding that the railway sector was a critical component and the engine of the economy. Industries depend heavily on the smooth operations of the railway sector for bulk movement of raw materials and products.

NRZs service delivery has been in decline over the past decade, from a capacity of 18 million tons per year down to only 5.3 million tones.

The embattled parastatal is left with 33 functioning diesel and one electronic locomotive out of more than 62 and 10 respectively.

About $750 000 and $20 000 is required to refurbish each locomotive and wagon respectively.

Early last year, Finance Minister Tendai Biti told the media that the railway system was on the verge of collapse as a result of mismanagement and failure to update its systems over the past 20 years.

The World Bank once recommended that NRZ should close down two thirds of its railway network to allow for rehabilitation because of the potential disaster it poses.

Zimbabwes railway network covers over 300 kilometres and includes signalling and telecommunications.

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