Zimasco begins to pay workers

Midlands Correspondent
THE Zimbabwe Smelting Company (Zimasco) says it has started paying its employees as it works on a turnaround strategy to breathe life into the country’s largest ferrochrome smelter.

Zimasco, which is 73 percent owned by China’s Sinosteel Corporation, has been facing viability challenges due to a plethora of problems among them the plummeting of ferrochrome prices on the global market.

This has resulted in the company downsizing its workforce from over 3,500 during peak production to the current 631 employees.

Some of the fired workers are yet to get their retrenchment packages while those still on the job have salary arrears running into several months.

Zimasco chief executive officer John Musekiwa told Chronicle Business that the company has started paying its workers.

He said: “We’ve started to pay slowly our employees because we’ve commissioned a small plant which produces 500 tonnes of ferrochrome per month.

“We’re also rendering services to Portnex International, which include laboratory services, transport system, crushing their ore and processing their slag which has helped us to raise some revenue. From that revenue we’re able to pay our employees but we’re a bit behind.”

Last year, Zimasco entered into a five-year lease agreement with Potnex International worth $12 million which has brought significant revenue inflows into the ferrochrome smelter’s coffers.

The Zimasco boss said the company was in discussion with a potential financier to extend a $5 million stimulus package to resuscitate the company’s operations to full throttle.

Developments to revive the company’s operations come after the ferrochrome smelter’s bid to be placed under judicial management hit a brick wall last year after the High Court ruled that the company had failed to comply with Section 299 of the Companies Act on the submission of such applications before it.

The firm had taken the route to save its assets from possible attachment as levels of its indebtedness to banks, employees and other creditors increased from $35 million to $65 million in 2015.