All recapitalisation deals remain on course: NRZ
THE National Railways of Zimbabwe (NRZ) says discussions with all foreign investors it has engaged to recapitalise operations remain on course amid high expectations that the parastatal will get a new lease of life soon.
NRZ has in recent years been knocking on the doors of many potential investors, pitching various investment projects in an attempt to modernise its services and operations.
Against this background, the parastatal has engaged a number of investors, including from Turkey where a Memorandum of Understanding (MoU) was signed in 2021 with a company called Yapi Merkezi for the modernisation of NRZ’s rail system.
Under the MoU, the Turkish firm is expected to bankroll the project and provide expertise for repairing rail tracks across the country while also financing the acquisition of new coaches and wagons. In yet another effort to revamp NRZ, the Government and India in June this year penned a US$81,2 million deal in terms of which the Asian country’s RITES Limited, is expected to supply the Zimbabwe railway firm with rolling stock comprising 3 000 horsepower diesel-electric locomotives and high-sided open wagons.
The African Export and Import Bank (AfreximBank) is expected to bankroll the first installment to RITES Limited before delivery of the first batch of rolling stock is made.
RITES Limited is a multi-disciplinary consultancy organisation in the field of transport infrastructure, and engineering, only to mention a few. The company has been in existence for 47 years and has tackled projects in over 50 countries across different continents which include Asia, Africa, Latin America, South America and the Middle East region.
NRZ has also entered into a similar arrangement with Union Wagons of Russia for the supply of 5 000 wagons.
In an interview, NRZ public affairs and stakeholder relations manager Andrew Kunambura said negotiations for all the deals with foreign investors regarding the parastatal’s recapitalisation were on track.
“We have had engagements with foreign investors over NRZ recapitalisation and discussions around recapitalisation are still on course. For example, in the Turkish deal, where a company called Yapi Merkezi is involved, a due diligence exercise was carried out by that company and a report has been prepared.
“Our team from NRZ went there (Turkey) for evaluation of the report after which that report will then be taken to our principal or shareholder, which is the Government before that Turkish firm starts the resuscitation of our rail tracks,” he said.
Lack of investment, mainly in freight wagons and the rail system, has negatively impacted NRZ over the past two decades, reducing its cargo-carrying capacity from an average of 18 million tonnes per annum in peak years in the late 1990s.
The entity is targeting to increase the capacity of its freight from the current 2,5 million annually to 6,5 million by 2025 to ensure the entity optimally plays its role as a key economic enabler.
On the other hand, the parastatal has had to suspend commuter passenger services in urban areas due to faulty railway equipment and infrastructure. On the RITES Limited deal, Mr Kunambura said once AfreximBank pays the first installment under the US$81,2 million deal, NRZ would start receiving the rolling stock.
“At present, AfreximBank are doing their own paperwork to make the first installment before we start receiving the first batch of the locomotives and wagons.
“With Russia, the deal is still at negotiation level and as to the time frame of the negotiations, we cannot say because that is also dependent on how fast the terms agreed on by both parties will sail through. The other side has its terms and we also have our terms so negotiations for that deal are still on course, and we hope that everything will materialise for a win-win situation by all the parties involved,” he said.-chronicle
