$1,3bn Harare-Beitbridge highway project resumes

via $1,3bn Harare-Beitbridge highway project resumes – DailyNews Live 4 September 2015

HARARE – Work on the Harare-Beitbridge highway is expected to resume soon following the withdrawal of a two-year court case filed by Zimhighways Consortium (Zimhighways) against government.

The $1,3 billion rehabilitation of the economically strategic highway was stopped in 2013 after the consortium dragged government to court for breach of contract.

However, in a joint statement released yesterday, Zimhighways announced that it was withdrawing the case.

“In the context of the tender mentioned above, Zimhighways and the government of Zimbabwe, through the ministry of Finance have agreed… to withdraw the matter in Case Number HC 7214/13,” the statement read.

According to the statement, the withdrawal of litigation by Zimhighways was to give the ministry of Finance a chance to initiate and undertake negotiations for an appropriate financing model for the upgrading of the highway.

Zimhighways — which won a tender to rehabilitate the highway in 2002 — has been accused of failing to raise the adequate capital to embark on the project.

However, Zimhighways managing director Darlington Masenda told businessdaily yesterday that the consortium had secured funding for the project when the tender was awarded.

“We need to understand each other on this, because the misconception has been perpetuated for a long time. When we won the tender, we were supposed to prepare a concession document that empowered us to raise funding offshore,” he said.

Masenda said government — through the Transport ministry — refused to guarantee loans from the Development Bank of South Africa (DBSA) and other financiers who had expressed interest in financing the project.

Masenda also said the consortium — made up of 14 construction firms including Murray & Roberts, Costain Africa, Kuchi Building Construction, Tarcon, Bitcon, Joina Development Company and Southland Engineers —  has now reached an agreement with government to be a sub-contractor in the project.

“The new policy now is that projects of this magnitude do not go to tender anymore, instead, a Cabinet committee decides on the suitable contractor.

“So, we are not going to tender or anything like that. Government has already picked an international company to be the main contractor and we will just be a sub-contractor and bring local capacity to the project,” he said.

According to government officials, Zimbabwe secured a loan from the DBSA for the project, as the development bank has already put in close to $2 million in technical assistance to assess how bankable the project is.

The Harare–Beitbridge Road is part of the trunk road network of Zimbabwe and is a part of the North–South Corridor, one of the major arterial links in the regional road network, it is also the most direct link between the capital cities of Harare and Pretoria and provides landlocked Zambia access to the Indian Ocean ports of Durban and Richards Bay in South Africa.

It carries between 1 000 and 5 000 vehicles per day with the heavier flows in the proximity of Harare. The road project is approximately 580km long, starting just outside Harare and ending at the Beitbridge Border Post.

It is a single carriageway two lane road with numerous bridges, some of substantial size.

Although well maintained in the past, the road is now over 40 years old, bumpy and dangerous in some places, and is rapidly deteriorating under the increased heavy vehicle traffic.