General Beltings (GB) says it has applied for $1 million under the Distressed and Marginalised Areas Fund (Dimaf) to boost its production capacity.
A total of $3,96 million has so far been disbursed to six companies under Dimaf. CABS is issuing loans of up to a maximum of $1 million to qualifying companies.
GB managing director Wilbroad Tsuroh said even if the company failed to benefit from the fund directly, there were benefits to be accrued from the resuscitation of other companies.
The company’s products were earmarked for the mining and agricultural sectors.
“We need to improve liquidity internally and downstream,” Tsuroh said.
“The trajectory in the past three years has, however, been encouraging.”
However, CABS who manage Dimaf, on Tuesday said the $40 million package to resuscitate defunct industries in the country did not exist at law — a development that could jeopardise recapitalisation plans of most companies.
In its financial results for the year ended December 2011, GB said as a result of shortages of long-term funding structures and a slow debtors’ book, the company incurred finance costs of $186 000 on borrowings of $750 000 reflecting a cost of finance of 24% per annum.
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GB recorded an operating loss of $1,4 million and plans to invest additional funds into the company to increase its output.
Its chairman Godfrey Nhemachena said: “The current initiatives to improve market liquidity to spur on and sustain the economic growth thus far together with the ‘Let Bulawayo Survive’ drive are expected to benefit both divisions (rubber and chemical).”
CABS managing director Kevin Terry said 31 companies had applied for $17,9 million. Applications from seven companies had been turned down so far.
“We have another 31 we are working on despite the fact we have no funds from the government yet and we have given those loans to companies in Goromonzi, Harare, Marondera, Victoria Falls and the majority of those in Bulawayo,” he said.
