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Twenty years looked like time without end when, on November 24, 1995, President Mugabe and the then South African leader, Cde Nelson Mandela commissioned the New Limpopo Bridge (NLB). Built under the build, operate and transfer (BOT) concept, many didn’t immediately understand why the government had agreed to the project being implemented on those terms and at that time. There was considerable resistance and pessimism among the motoring public, who suddenly had to incur an additional tax to drive on the new bridge and other sections of the society who wondered why it was necessary to build a bridge when we already had another functional piece of infrastructure in place – the Beit Trust-constructed one on which they drove free of charge.
The level of the initial toll charges levied – $3 for light vehicles and $17 for heavy vehicles – did nothing to appease the doubters. The government had to defend the project from those who were opposed to the idea of a pay bridge when a free one existed.
Four years after the commissioning of the new bridge, the same company and the government launched another project, the Beitbridge-Bulawayo railway line. The 350km line from Beitbridge to Bulawayo is also a BOT initiative, to expire in 2029. We have obviously have had many other infrastructural developments implemented under the same concept since then.
But the New Limpopo Bridge was the first major infrastructural project the country did under the BOT system, working with the New Limpopo Bridge (Pvt) Ltd. Its success, seen in its roaring commercial viability over the past 20 years and the government taking over its ownership and management on Monday, is a great example of how effective the BOT concept can be in revitalising our ageing existing infrastructure and building new systems even if we are suffering from an extreme liquidity crisis.
NLB was collecting a reported $1,6 million monthly in toll charges for vehicular traffic using the bridge. Now this money would be accruing directly to the government of Zimbabwe through toll collector, Zimbabwe National Roads Administration. It represents an important revenue stream for Zinara, around $19,2 million yearly.
Our infrastructure — roads, railways, bridges, power generation and transmission and water and sanitation systems — are poor and need billions to revive, and billions more to build totally new ones.
We don’t have that money at this stage because the economy is performing badly. Raising domestic revenues to build and or renew our infrastructure on a scale that we have to so that we come close to the state of public facilities in South Africa or Botswana levels is impossible.
Additionally, multi-lateral and western bi-lateral institutions that have the wherewithal to fund them, have no interest in doing so. Therefore, the only viable alternative we have in the circumstances is the BOT way.
Transport and Infrastructural Development Minister Dr Obert Mpofu said on Monday: “The handover of this project is therefore testimony that private-public-partnerships work and should be seriously considered as an alternative way of financing infrastructure development in the region.”
He is correct and there are a number of projects that come to mind.
The Harare-Beitbridge Road, our busiest trunk road has been criticised for being too narrow and rugged. Many accidents have occurred on that road. It is one possible candidate for a BOT makeover. In fact, it needs to be replaced completely, and the new one has to be a dual or triple carriageway. We don’t foresee challenges in securing a willing investor to build a new road linking Chirundu-Harare-Beitbridge. We understand that there is some work in that regard, but is has been worryingly slow.
Zim Asset, under its infrastructure and utilities cluster rightly recognises the centrality of the BOT system in expanding our infrastructure. It is one of the four strategies that can be used in redoing our transport infrastructure and is identified as providing concessions to public sector service providers. The other three are mobilising resources from friendly nations, entering into public-private sector partnerships (related to BOT), and strengthening the Public Sector Investment Programme.
It has to be hoped that the example that the New Limpopo Bridge has set, having been the first national project to be undertaken under the BOT system, must energise us to actively pursue the same strategy on other critical economic enablers.
It might look like the private companies that provide the funding to build a projects make too much profit until the point when ownership and management is transferred to government, but that is actually not the case. The funders cannot provide their money for free; they must get a fair return on their investment.
In the end, the government benefits as infrastructure like bridges, dams and so on can be used for centuries, of course with regular, mandatory checks and maintenance works. The Victoria Falls Bridge, for example, was commissioned in September 1905, which makes it 109 years now. It is still safe to use. After its recent renovation, experts declared it would be used for another 100 years with no problems.
Therefore, 20 or 30 years of BOT is nothing, given the relative permanence of critical infrastructure.
derick.khumalo