Govt re-tenders NRZ recapitalisation deal Minister Matiza

Herald Reporter

Cabinet wants the National Railways of Zimbabwe (NRZ) recapitalisation project re-tendered following the cancellation of the US$400 million deal involving the Diaspora Infrastructure Development Group (DIDG) and Transnet last month.

DIDG failed to provide proof of funding for almost two years, leading to the cancellation.

Already, a firm deal has been signed with a Russian company to provide wagons and locomotives, with the first 100 wagons expected in January.

The DIDG-Transnet deal was cancelled after the consortium failed to meet contractual timelines, two years after winning the tender, principally failing to provide proof of funding despite repeated enquiries from the Government.

DIDG was given a six-month grace period to provide the proof of funding which again lapsed, leaving Government with no option except to cancel the tender.

It also emerged that DIDG had won the tender using the financial books of Transnet, but they later presented a funding structure based on funds sourced internationally, which excluded Transnet.

The exclusion of Transnet complicated the deal, raising legal issues to the initial contract.

Several foreign investors are already expressing interest in Zimbabwe’s rail sector.

Last month, NRZ signed the new deal with Union Wagons of Russia for the supply of wagons and locomotives, while Indonesia expressed interest to invest in the same sector.

Under the Russian deal, NRZ expects to boost its capacity utilisation through the supply of 5 000 wagons.

The first 100 wagons are expected in January at a cost of US$10 million.

Transport and Infrastructural Development Minister

Herald Reporter

Cabinet wants the National Railways of Zimbabwe (NRZ) recapitalisation project re-tendered following the cancellation of the US$400 million deal involving the Diaspora Infrastructure Development Group (DIDG) and Transnet last month.

DIDG failed to provide proof of funding for almost two years, leading to the cancellation.

Already, a firm deal has been signed with a Russian company to provide wagons and locomotives, with the first 100 wagons expected in January.

The DIDG-Transnet deal was cancelled after the consortium failed to meet contractual timelines, two years after winning the tender, principally failing to provide proof of funding despite repeated enquiries from the Government.

DIDG was given a six-month grace period to provide the proof of funding which again lapsed, leaving Government with no option except to cancel the tender.

It also emerged that DIDG had won the tender using the financial books of Transnet, but they later presented a funding structure based on funds sourced internationally, which excluded Transnet.

The exclusion of Transnet complicated the deal, raising legal issues to the initial contract.

Several foreign investors are already expressing interest in Zimbabwe’s rail sector.

Last month, NRZ signed the new deal with Union Wagons of Russia for the supply of wagons and locomotives, while Indonesia expressed interest to invest in the same sector.

Under the Russian deal, NRZ expects to boost its capacity utilisation through the supply of 5 000 wagons.

The first 100 wagons are expected in January at a cost of US$10 million.

Transport and Infrastructural Development Minister Joel Biggie Matiza said the recapitalisation tender would be flighted soon.

He said NRZ recapitalisation was key to the revival of the industry as it would facilitate the bulk movement of goods and people.

“We are going to re-tender the project as directed by Cabinet. Processes are already underway to ensure that we flight another tender. By next week, I will have full details on how much ground has been covered in this regard.

“Recapitalisation of our national railway is key to the revival of our industry. It is also in line with the attainment of targets that we have set for ourselves in line with Vision 2030,” said Minister                                               Matiza.

A vibrant railway system, the minister said, was key in the transportation of minerals from the mines and agricultural producers to ports such as Beira.

Information gathered by The Herald showed that DIDG was trying to circumvent Government processes in the implementation of its deal with NRZ.

The Herald is reliably informed that DIDG by-passed the parent Ministry of Transport and Infrastructure Development and Government financial advisors Deloitte and Touche to validate its funding structure with Treasury.

The funding structure that DIDG wanted Treasury to validate excluded Transnet and had no input from the Ministry of Transport and Infrastructural Development and Government financial advisors.

said the recapitalisation tender would be flighted soon.

He said NRZ recapitalisation was key to the revival of the industry as it would facilitate the bulk movement of goods and people.

“We are going to re-tender the project as directed by Cabinet. Processes are already underway to ensure that we flight another tender. By next week, I will have full details on how much ground has been covered in this regard.

“Recapitalisation of our national railway is key to the revival of our industry. It is also in line with the attainment of targets that we have set for ourselves in line with Vision 2030,” said Minister  Matiza.

A vibrant railway system, the minister said, was key in the transportation of minerals from the mines and agricultural producers to ports such as Beira.

Information gathered by The Herald showed that DIDG was trying to circumvent Government processes in the implementation of its deal with NRZ.

The Herald is reliably informed that DIDG by-passed the parent Ministry of Transport and Infrastructure Development and Government financial advisors Deloitte and Touche to validate its funding structure with Treasury.

The funding structure that DIDG wanted Treasury to validate excluded Transnet and had no input from the Ministry of Transport and Infrastructural Development and Government financial advisors.

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