Source: Govt failing to deliver on promises, commitments – DailyNews Live
Eric Chiriga 5 September 2017
HARARE – Last week, President Robert Mugabe’s government announced yet
another mega deal in the making.
This time around, it’s billionaire Chinese investor, Zhang Li – co-founder
and chairman of R&F – whom they are touting as the new survivor of
collapsed iron and steel manufacturer Ziscosteel.
Li is said to be investing an initial $1 billion in the project, with
Industry minister Mike Bimha telling Zimbabweans that if the deal goes
through, the investment would double up to $2 billion.
While interesting, Li’s arrival on the scene comes as long-suffering
Zimbabweans are wary of these so-called mega deals.
The burning question is what happened to the other deals, which were
equally hyped, announced before.
This seemingly attractive and sweet R&F bailout plan is not the first one
to be crafted by government to revive the strategic Ziscosteel asset.
Countless times, government has introduced, with zeal, investors it said
were serious on reviving the iron and steel manufacturer.
Following bids by 12 companies in 2009, including steel giant Arcelor
Mittal, in 2010, an upbeat government announced that it was partnering
Essar Africa in a $750 million deal, which was eventually finalised in
2011.
The deal was so hyped, just like Li’s. Now that Li is here, surely
Zimbabweans are burning to know what came about of the Essar deal, among
many others.
In explaining the collapse of the Essar deal, curiously, Bimha said: “One
of the reasons why the Essar deal did not come to fruition, I think the
time that it was consummated was not the right environment. That time when
we had an inclusive Government.”
“This time around, it’s different, the entire Government is supportive of
this project and that is the reason for us to come here. The president is
fully behind this project. Therefore, I think in terms of commitment, I
think there is 100 percent from Government to make it a success.
“Also on the time when we felt Essar would come on board, they made
reference to the depressed market for iron and steel products and they
felt it was not the time for them to invest.
They felt that because of the prices that were down, they were not in a
position to go around and borrow money.
“Now, this is not a problem as far as this investor is concerned. He did
not express any problem with issue of prices, the market of funding, so we
are confident that the investor is willing and able to get into this
project and also the government is supportive.”
However, apart from the mineral prices and inclusive government haggling,
as far as we remember, the other major problem which led to collapse of
the Essar deal was squabbles over mineral rights.
But fair fine, this is not about the R&F-Ziscosteel deal per se.
The point is about government delivering on its promises and commitments.
A lot of resources – time and hard-earned tax payers’ money – are wasted
in consummating these so-called mega deals.
Bimha mentioned that there is a team handling negotiations of the deal in
China.
That does not come cheap.
Government seems to have developed a habit of initiating projects it never
completes.
The trend is worrying and Zimbabweans are frustrated.
They are finding it increasingly hard to believe government.
Imagine in the case of the Essar deal where suffering workers – unpaid for
months – were given hope, and nearly ten years later, you are starting
afresh.
Just recently, the market with abuzz with news that struggling State-run
National Railways of Zimbabwe had a crafted a $400 million deal involving
South Africa’s Transnet and the Diaspora Infrastructure Development Group.
Apart from that, where are the mega Chinese deals?
What came out of the much-hyped Aliko Dangote deals?
It’s so disheartening.
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