Gwaradzimba blamed for crisis at Shabanie-Mashaba Mines

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The Parliamentary Portfolio Committee on Mines and Energy has blamed Shabanie-Mashaba Mines Holdings (SMM) Administrator, Arafas Gwaradzimba and his management for the destruction of the mine.
The committee led by chairman, Edward Chindori-Chininga (Zanu PF) on Monday, grilled Gwaradzimba at a meeting that lasted for two and a half hours in parliament.
Gwaradzimba made shocking revelations, admitting his administration was no longer able to pay workers who have gone for over a year without salaries. A recent visit by NewsDay to Shabanie exposed the misery that has become the way of life for hundreds of workers at this once bustling mining entity.
Gwaradzimba told parliamentarians that the company that he has presided over since government seized it from Mutumwa Mawere now owed its workers a whopping $10 million in unpaid wages.
SMM Holdings employs 3 100 people.
The MPs charged that instead of carrying out his mandate of reconstructing the mines, Gwaradzimba had destroyed Shabanie-Mashaba mines in monumental fashion. Hundreds of workers had been plunged into untold suffering as a result.
They (MPs) said SMM Holdings management had been busying itself chasing court cases against the exiled businessman, Mutumwa Mawere instead of finding money to pay its workers who have not had salaries for one and a half years now.
“The issue is you were able to raise $2 million to go and buy shares in the United Kingdom and that $2 million has not been repatriated back, …yet no money is being raised to deal with the issues of the people on the ground,” said Chindori-Chininga, MP for Guruve South.
Gwaradzimba said in 2004, the Minister of Justice and Legal Affairs, Patrick Chinamasa approved his proposal to sell housing to staff as a way of paying them.
He denied allegations that he had been living large through a 6% of the company’s gross turn over that he claimed every month as payment for his services.
Fani Munengami MP for Glenview (MDC-T), apparently unconvinced by Gwaradzimba’s excuses asked him to resign from his post as curator.
“The situation at the mine can be likened to HIV and Aids because there is no functional equipment at all. You are trying to butter us – trying to paint a picture of hope when really there is no hope,” the MP for Bikita West (MDC-T), Heya Shoko charged.
“If this committee recommends that you be investigated for killing the mine, what would you say? You are now selling the claims, you are killing the mine,” Chivi South MP Ivene Dzingirai (Zanu PF) weighed in.
But a cornered Gwaradzimba trying to keep on his feet, insisted the mine would recover if it was recapitalised.
He said the mine was already in mortal danger when he was called in to manage it as its curator in 2004 by minister Chinamasa. He said SMM Holdings was already heavily indebted to local and foreign banks and suppliers.
Gwaradzimba said all efforts to find investors for the mine had failed. He said Cabinet had instructed him to seek investment only from the Chinese but, although he tried his best, no Chinese or any other investor wanted to get involved with the company.
“The Cabinet minutes that I was given required that I only seek for investors from the Chinese and that I go into a marketing arrangement with the Chinese. I met a few Chinese business people in Zimbabwe but none were interested,” explained Gwaradzimba.
He had also tried to look for an investor through private placements by engaging MBCA and Genesis banks to shortlist investors for SMM Holdings, but none of them wanted to have anything to do with the troubled mine.
“I also approached Zimre and met with the CEO to engage them to do fundraising for SMM Holdings, and again, after several months they came up with nothing,” Gwaradzimba said.
The MPs did not sympathise with Gwaradzimba’s position saying it was only natural that people distanced themselves from a company which had lost virtually all its equipment as a result of mismanagement and other misdeeds.
Gwaradzimba then tried another angle:– the reason investors were shying away from SMM, he said, was the legal battle between government and Mutumwa Mawere.
He said an Indian company was willing to invest but no bank was willing to discount the letters of credit.
“The company, which is the 6th biggest asbestos producer in the world was producing 150 000 tonnes of chrysotile fibre per annum but now it is producing nothing,” commented Moses Mare, MP for Chiredzi West (MDC-T).
The MPs were dismayed that Gwaradzimba had never gone underground to see the real issues of obselete equipment bedeviling the mine.
“The only things that we found functioning at the mine when we visited were the golf course and the hospital,” said Chindori Chininga.
Gwaradzimba said from 2006, the company had made no significant sales and production was very depressed.