adminthis country’s economic landscape.
It is against this background that we seek to understand the delays over the implementation of the Essar Holdings deal in which Government sold 54 percent of its stake to the Indian firm for the resuscitation of Ziscosteel, now NewZim Steel.
This is a strategic investment in a critical sector of the economy, but the current state of affairs seems to be running contrary to this.
It is mind-boggling that for more than a year, operations have not begun for the sole reason that the company has not been granted iron ore mining rights that were part of the deal in the first instance. What is stalling progress in this regard?
The aplomb and celebrations that marked the launch told a story that the fortunes of the giant steelmaker were about to change for the better after spending a long time in the intensive care unit.
President Mugabe, who officiated at the launch ceremony, was ecstatic.
“We have today a demonstration of confidence in Zimbabwe by a major international company of repute. On behalf of the Government and the people of Zimbabwe, I wish to express my gratitude to Essar Holdings for coming to partner with us in this strategic sector of our economy,” he said at the launch ceremony.
But developments since then seem to have watered down the excitement and the hope that had reawakened in many people, particularly those that had been left redundant when Zisco ground to a halt.
We notice that the Minister of Industry and Commerce, Professor Welshman Ncube, and his Mines and Mining Development counterpart, Dr Obert Mpofu, are throwing brickbats at each other over who is responsible for pushing the deal ahead.
This is not healthy for a country that needs such kind of investment to improve the welfare of its people, in this instance the residents of Redcliff and surrounding areas.
The company had already taken on 1 500 employees who have been receiving salaries well before operations commenced. It is understandable that Essar says it cannot continue to pay salaries when there has been no production taking place.
Simple economics would state that it does not make business sense to pay idle labour.
The issues surrounding the case must be brought to the fore and ironed out so that the company gets down to business.
While we appreciate the need for Zimbabwe to safeguard its resources and ensure the country is not compromised in any way, we feel any due diligence in respect of any aspects of the deal should have been done before the signing ceremony.
It, therefore, does not make much business sense for the parties to begin to fight now unless we are missing something here.
We applaud the Industry and Commerce Parliamentary Portfolio Committee for acting swiftly by summoning the two ministers to explain the state of affairs.
We urge this committee to get to the bottom of the issue and chart the way forward in a manner that does not compromise the resumption of production at NewZim Steel.
We certainly hope the meeting will be held with haste.
Any further delays will send the wrong message to other potential investors while affecting the welfare of the workers who are now having to make do without their salaries at a time the economy is facing immense challenges.
NewZim Steel is a potentially viable project that could soon see Zimbabwe earning significant amounts of foreign currency from imports while resumption of operations will have downstream benefits.
Every job in a steel plant generates five others downstream so this project has potential to create thousands of jobs in other firms.
With production largely expected to grow from an initial one million tones per annum to 2,5 million tonnes over the next few years, employment figures are expected to double or even treble.
NewZim Steel is certainly no small project and any personality clashes should not be allowed to ruin it.
The Indian Ambassador to Zimbabwe, Mr Jeitendra Tripathi, recently expressed his concern over delays in implementing the deal but was optimistic any outstanding issues would be dealt with timeously.
This has not been the case so far and the pleas by workers are indicative of the challenges surrounding the deal.
We hope that a logical and beneficial conclusion to the outstanding issues will be arrived at soon.
Online Reporter