CSC revival plans await Cabinet scrutiny

Business Reporter
PLANS to revive the Cold Storage Company are still awaiting Cabinet approval as the firm looks to explore new beef export markets once it is back on its feet. Agriculture, Mechanisation and Irrigation Development Deputy Minister responsible for livestock production Paddy Zhanda said the proposal for the revival of CSC was yet to approved by Cabinet.

“We’ve submitted our proposal to Cabinet and it’s still under consideration. “I can’t comment on the plans as I would pre-empt it,” he said.

Earlier, the deputy minister said Government was scouting for investors to bail out CSC, adding that discussions with the suitors were on-going to operationalise its defunct CSC depots in Masvingo, Kadoma, Marondera and Chinhoyi.

The CSC has only one functional branch in Bulawayo. The deputy minister is however on record as saying he did not think it was necessary to have an investor.

In the past, the deputy minister has condemned private abattoirs for slaughtering cattle at exorbitant amounts per animal “yet they were doing little work”.

He said this was why the country needed to have the CSC fully operational as it was a catalyst in the livestock sector, which can put private abattoirs into line.

CSC suffered a major setback when the European Union suspended beef exports from Zimbabwe in 2001 following an outbreak of foot-and-mouth disease.

CSC had an annual quota of beef exports to the EU of 9,100 tonnes. It also had a $15 million revolving payment facility with the EU, under which it was paid in advance. The company used to earn the country at least $45m per year.

However, deputy minister Zhanda said the facility under which Zimbabwe had a beef export quarter to the EU was under the Lome agreement, which had expired.

As such, he said that the country did not necessarily need to export to the EU, but that there were other potential lucrative markets where it sell its beef.

But prior to that, the deputy minister said, the country needed to put its act together. This included production capacity and other key procedural issues.

CSC used to play a leading role in the processing and marketing of Zimbabwe’s beef since its inception in 1937 following outbreak of foot and mouth disease.

However, it fell on hard times from the year 2000 owing to a myriad of challenges, that included inadequate working capital, cattle diseases, decline in the commercial herd, huge foreign debt, high staff turnover and old transport fleet.

CSC last exported beef in 2007 because of serious uncontrolled outbreaks of foot and mouth diseases. The EU stopped importing beef from the country after CSC failed to meet the international standards required when exporting beef.

CSC reportedly owes US$22 million to various creditors and has a salary backlog of US$2,1 million. It is operating at seven percent capacity utilisation and has a skeletal workforce of about 500 workers compared to 1,500 in 1999.