‘Target viable firms’

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Leading economist Tony Hawkins has urged government to ensure the $40 million Distressed and Marginalised Areas Fund (Dimaf) benefits companies with potential to turn around their fortunes and be able to stand on their own once weaned off.

Hawkins made the remarks while presenting a paper on Zimbabwe’s economic prospects for 2012 at the Alpha Media Holdings Strategic Planning Conference in Harare on Monday.

About 87 Bulawayo firms have reportedly closed shop over the last few years, leaving more than 20 000 jobless.

The government has shortlisted 58 companies to benefit from the bailout fund, with three reportedly said to have been approved.

“There are some companies who were relying on other entities, like Ziscosteel for instance, for their success so if problems within the bigger company are not resolved the bailout might not work,” Hawkins said.

“It also has to be understood that some companies’ operations have been affected by external problems such as a shortage of power and high wages when compared to their competitors in the region.”

He said those giving loans under Dimaf should make sure that companies that were to be helped had the potential to return to profitability in the medium term.