Lusaka — The Zambian government has expressed concern at the poor performance of the privatised Kawambwa Tea Company in Luapula province and has called for its quick revival.
Commerce, Trade and Industry minister Bob Sichinga said the government was interested in knowing the state of Kawambwa Tea Company, which is currently owned by a Zimbabwean investor Kulmul Holdings, headquartered in Ndola.
He said there was an urgent need to re-engage the private investor operating the company to try and resolve the outstanding issue.
“Our concern really, is the performance of the company as to whether it is doing well or not,” Sichinga said.
Various quarters have been calling on the government to reposses the company and give it to serious investors, who will turn it around, so that it could contribute more effectively to the country’s economic development.
The company, which employs 212 permanent employees, has been facing financial and operational problems since its privatisation in early 1996.
In 2009, Zanaco Bank advanced the company a loan of K6 billion to help revive its operations, but the cash injection has to date, not yielded any tangible results.
Kawambwa Tea Company owes workers more than K4 billion in unpaid salaries and various statutory contributions, while more than K700 million is owed to workers in accrued terminal benefits.
A further K240 million is owed to the National Pensions Scheme Authority and K75 million to the Workers’ Compensation Control Board.
It also owes billions of Kwacha to local authorities in rates and levies and Zesco in power bills.
The company’s production capacity has been hovering between 20 and 30 tonnes per month, but production levels were likely to plummet further because of persistent operational problems.
Last year the company’s employees and managers called on the Zambian government to retain 51% shares when it repossesses the company, to partner with a new equity investor. —