THE National Railways of Zimbabwe (NRZ) has reportedly failed to pay its 7 000 employees for the past five months because of the country’s weakening economy, an official has said.
NRZ spokesperson Fanuel Masikati confirmed the State-run transport utility was five months behind schedule paying salaries to thousands of its workers.
Company closures in the country’, second-largest city of Bulawayo have hurt its ability to turn around operations, Masikati said.
“It’s true we haven’t paid the workers over the past five months,” Masikati said on Tuesday. “We are in arrears. The whole economy is not performing. We are the backbone of Zimbabwe, but without business there is nothing we can do.”
NRZ needs $400 million to upgrade its infrastructure, as it tries to boost its cargo carriage from the about 6,4 million metric tonnes of goods it is forecast to move this year. The company suspended recruitment and the replacement of retirees or employees who died, Masikati said.
NRZ has paid a $2,9 million deposit to China North Railway Limited for locomotives that haven’t been delivered because the government hasn’t guaranteed the $29 million loan, he said.
The development came at a time when the government was considering setting up a railway regulatory authority to formulate, monitor and evaluate the railways industry and restructure the struggling railway company.
Under the proposed turnaround strategy for the NRZ, the loss-making entity would be unbundled into three companies dealing with infrastructure, freight and passenger services, whose operations and management will be totally divorced from each other.—Bloomberg/Business Reporter