Tinashe Makichi and Conrad Mwanawashe The situation at Ziscosteel is deplorable with no activity on the ground while the company is selling...
Tinashe Makichi and Conrad Mwanawashe
The situation at Ziscosteel is deplorable with no activity on the ground while the company is selling sundry products to remain afloat.
The plant itself is deteriorating “quite visibly” and Ziscosteel management and workers are on their own, the officials say.Ziscosteel chief executive Alex Gowo told a parliamentary portfolio committee on Industry and Commerce yesterday that the situation at the steel company is “worrisome” despite the coming on board of Essar.
“It’s a sad state of affairs and we are not happy about the current situation,” said Gowo.
Ziscosteel stopped production in January 2008 and since then there has not been any commercial production of iron and steel at the plant.
Gowo said management and the board embarked on ways to raise funding in a bid to resuscitate the company using the available resources, primarily through the sale of sundry products.
“We have products such as blast furnace slag from our furnaces which is used in the making of cement; we have such products in large quantities. We have buntline which is used in gold mining and agricultural activities,” said Gowo.
He said the company’s workforce has been mostly involved in the recovery and processing of the sundry products.
“Not to say that they are gainfully employed on a day-to-day basis but these are survival tactics that we adopted to carry us through to enable us to pay for utilities at Ziscosteel. We are making token payments for utilities,” he said.
“There is no activity on the ground and if it was a small matter at least some activity could be going on at a slow pace as we await the government to finalise the whole deal.
“As management we are not happy and like any business and any company that goes for a month without business realises losses and we have been accumulating losses for over three years,” said Gowo.
In 2010, Essar agreed to buy 54 percent of Ziscosteel, now NewZim Steel, in a deal initially worth $750 million but the deal ran into problems over mineral rights that were to be given to the company’s subsidiary, NewZim Minerals.
The multi-million-dollar deal for NewZim Steel’s revival, however, edged closer to reality recently when the government and Essar agreed to immediately operationalise the firm. Gowo said Ziscosteel is on its own at the moment and there is no other partner on the ground and management is still waiting for the government which is the major shareholder and Essar direction.
“Nothing has been done towards the rehabilitation of the plant and each month that goes by without production the plant will continue to deteriorate,” according to Gowo.
In May this year there were promises that the workforce would get school fees and medical aid facilities and that obligation was fulfilled. Management under the directive from the shareholders managed to secure $400,000 from CBZ bank in two tranches that went towards medical aid and school fees.
The situation at Ziscosteel is deplorable with no activity on the ground while the company is selling sundry products to remain afloat.
The plant itself is deteriorating “quite visibly” and Ziscosteel management and workers are on their own, the officials say.Ziscosteel chief executive Alex Gowo told a parliamentary portfolio committee on Industry and Commerce yesterday that the situation at the steel company is “worrisome” despite the coming on board of Essar.
“It’s a sad state of affairs and we are not happy about the current situation,” said Gowo.
Ziscosteel stopped production in January 2008 and since then there has not been any commercial production of iron and steel at the plant.
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| ‘Sad state of affairs at Zisco’ |
“We have products such as blast furnace slag from our furnaces which is used in the making of cement; we have such products in large quantities. We have buntline which is used in gold mining and agricultural activities,” said Gowo.
He said the company’s workforce has been mostly involved in the recovery and processing of the sundry products.
“Not to say that they are gainfully employed on a day-to-day basis but these are survival tactics that we adopted to carry us through to enable us to pay for utilities at Ziscosteel. We are making token payments for utilities,” he said.
“There is no activity on the ground and if it was a small matter at least some activity could be going on at a slow pace as we await the government to finalise the whole deal.
“As management we are not happy and like any business and any company that goes for a month without business realises losses and we have been accumulating losses for over three years,” said Gowo.
In 2010, Essar agreed to buy 54 percent of Ziscosteel, now NewZim Steel, in a deal initially worth $750 million but the deal ran into problems over mineral rights that were to be given to the company’s subsidiary, NewZim Minerals.
The multi-million-dollar deal for NewZim Steel’s revival, however, edged closer to reality recently when the government and Essar agreed to immediately operationalise the firm. Gowo said Ziscosteel is on its own at the moment and there is no other partner on the ground and management is still waiting for the government which is the major shareholder and Essar direction.
“Nothing has been done towards the rehabilitation of the plant and each month that goes by without production the plant will continue to deteriorate,” according to Gowo.
In May this year there were promises that the workforce would get school fees and medical aid facilities and that obligation was fulfilled. Management under the directive from the shareholders managed to secure $400,000 from CBZ bank in two tranches that went towards medical aid and school fees.
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