adminRestructuring Agency, says an SEP restructuring report.
In addition, the slow pace of restructuring has been a result of lack of commitment from line ministries and management of State entities.
Last year, Government approved the urgent restructuring of 10 State-owned firms. But notable progress has only been achieved in Zimbabwe Iron and Steel Company and the National Oil Company of Zimbabwe.
Government sold its 60 percent stake in cash-strapped Zisco to Indian giant Essar. The transaction would result in a US$750 million investment to revive Zisco, which ceased operations three years ago.
This will relieve Government of more than US$340 million debts and help retain over 3 700 jobs when the firm starts full operations.
The National Oil Company of Zimbabwe was unbundled into Petrotrade and the National Oil Infrastructure Company of Zimbabwe.
The two companies became operational on January 1 this year. Transfer of assets from Noczim to the successor companies for accounting purposes was concluded at the same time.
“It is important to note that my ministry through SERA has been facing many challenges in driving the process of restructuring due to lack of the legislation framework for SERA to drive the process,” said the report prepared by State Enterprises and Parastatal Ministry.
“The slow pace of restructuring has also been a result partly of lack of commitment from the same line ministries and management of SEPS.
“Fear of the unknown and resistance to change have seriously affected the decisions on options to be presented to Inter-ministerial Cabinet Committee on Privatisation of Parastatals and Cabinet.”
The report said to ensure a transparent and credible restructuring process of Government firms, the Ministry of State Enterprises and Parastatals was working on the promulgation of the SERA Act.
However, the ministry will continue working with line ministries to ensure that the restructuring of the State companies identified under the first batch is undertaken with urgency, given the need to turn
around their fortunes and start contributing to economic growth.
Some of the State entities targeted for restructuring include Air Zimbabwe, Cold Storage Company, Agribank, the subsidiaries of Zesa Holdings, TelOne, POSB, Civil Aviation Authority, among others.
Most parastatals and State enterprises have been underperforming over the past decades, with their accounts not being properly audited.
Lack of a sound corporate governance framework had largely contributed towards their poor performance. This prompted Government to adopt a Corporate Governance Framework for State
Enterprises and Parastatals to attract investors. Over the last decade, the parastatals and State enterprises have been a burden to the fiscus as they relied on perennial handouts.
This was caused by viability constraints. But directors and department heads were rewarded handsomely.
Online Reporter