City stops paying Chinese firm

Innocent Ruwende Municipal Reporter
HARARE City Council has stopped paying the Chinese company contracted to rehabilitate Morton Jaffray water works under the $144,4 million loan facility as it is not satisfied with costs of work done so far.

It paid China Machinery and Engineering Corporation $72 million for the preliminary work.

This emerged during a familiarisation tour of Morton Jaffray by Local Government, Public Works and National Housing Minister Saviour Kasukuwere and senior officials from his ministry.

CMCE project director Mr Cao Yang told the minister that city officials were not pushing the Ministry of Finance and Economic Development to instruct China EximBank to release funds to his company for work done so far.

“Since 2013, we have not received any payment. We have now spent more than we received. The challenge is that we cannot complete the works without the funds.

“Only half of $72 million was released. The city is supposed to write to the Ministry of Finance, who will then instruct the bank to pay us,” he said.

Harare Mayor Bernard Manyenyeni said to his knowledge the city had so far paid $69 million while the contractor had only done some minor work.

“We are almost halfway in terms of the draw-down, and we are attributing that amount of $69 million or $72 million to preliminary work which sounds a little too high. But let us have the full reconciliation between the two parties.

“Like I said, $3 million is a big gap. We are going to sit down with our contractors and see where the difference is. There is also the issue where they are saying there are delays in payment. We will sort that out with the minister (Cde Kasukuwere) and the Ministry of Finance,” he said.

Minister Kasukuwere said his ministry will sit down with the two parties in order for them to reach a com- promise.

“I do not think that it is a major concern. They (City of Harare) just want to see that there is value for money.

“Quite a lot of progress has been made and from the indications given to us by the authorities, I think the output has now increased.

“We are also seeing some of our suburbs, which had not received water in quite a long time getting some. We are happy,” he said.

The China EximBank awarded a $144 million loan to the Harare City Council in 2011 and contracted CMEC to upgrade Harare’s water and sewer system.