Zinara seeks payment plan for US$206m loan

Source: Zinara seeks payment plan for US$206m loan | The Herald

Zinara seeks payment plan for US$206m loan
Engineer Michael Madanha

Mukudzei Chingwere recently in Beitbridge

THE Zimbabwe National Road Administration (Zinara) is seeking to renegotiate the US$206 million loan extended to it by the Development Bank of Southern Africa (DBSA) for the refurbishment of the Plumtree-Mutare Highway in 2011.

Under the existing contract, Zinara should complete servicing of the loan in 2021, which they say “is no longer possible”.

From the US$206 million, Zinara still owes the bank approximately US$186 million, having paid something in the region of US$20 million. Due to changes in monetary policies that saw the Zimbabwean dollar being rated against the US dollar, the road administrator said it was no longer able to meet the 2021 deadline.

Zinara board chairman Engineer Michael Madanha told parliamentarians who toured Zinara offices in Beitbridge last Thursday that they were engaging local financial institutions to pay off the loan, failure of which they will seek another 10-year repayment period.

“This loan was signed in 2011, so 2021 we are supposed to clear, but because of the shortage in foreign currency that we are facing, we are not able to finance all loan obligations, and as such we are now negotiating,” said Eng Madanha.

“We are going to start negotiations with the bank with a view to extend the loan repayment period, with at least 10 more years because we are heavily affected.

“When dollarisation was introduced and (when) our Zimbabwean dollar was one as to one with the US dollar, it was very easy for us because we could take all the money from other revenue streams and we could use that money to service our loan. Now that we have to convert the money to the US dollar to pay our external obligation, it is difficult for us.

“What we are doing now is to see if we can renegotiate the loan for 10 more years or we arrange a local loan to actually pay off our loan at the agreed period, which is 2021, then we remain servicing the new loan under new conditions altogether.”

Zinara acting chief executive Mr Gilfern Moyo said they were collecting an average of US$2 million a month from Cross Border Movement, but all the money was ring-fenced to service the DBSA loan.

He said they were advocating for the consolidation of all Zinara revenue collection streams some of which are currently being done by the Vehicle Inspectorate Department on a 20 percent commission.

Mr Moyo said the consolidation would allow them to increase disbursements to road authorities.

Before touring the New Limpopo Bridge, the parliamentary portfolio committee on transport and infrastructural development had a brief stopover at Lutumba tollgate to have an appreciation of the Zinara operations there.