ESSAR Africa Holdings is set to resume operations at the country’s former steel giant Ziscosteel, a move expected to ease the plight of thousands of workers after the government reportedly made an undertaking to honour the deal, a parliamentary committee heard yesterday.
BUSINESS REPORTER
Presenting oral evidence before the Parliamentary Portfolio Committee on Industry and Commerce, Ziscosteel chairman Nyasha Makuvise and chief executive Alois Gowo said the Ziscosteel board met a Cabinet inter- ministerial committee in charge of implementing the $750 million deal early this month to discuss the matter.
Cabinet in December resolved that the government would honour the initial deal despite a longstanding dispute and bureaucratic bungling threatening the resumption of operations at Ziscosteel.
So dire has the situation developed at Midlands-based steel works that the government has resorted to dispose property to pay workers as the company continues under care and maintenance despite courting new investors several years back.
“All employees are facing challenges in meeting family obligations like paying school fees, paying rentals for those who are renting and even day-to-day upkeep.
At the most, sometimes as Zisco, we managed to pay a quarter of the salaries and that would have been a major achievement in the last six months,” Gowo said.
Ziscosteel is a government investment arm which partnered Indian investors, Essar Africa Holdings to establish NewZim Steel (NZS) and NewZim Minerals (NZM). The deal, when completed, would result in the government owning a 40% stake in NZS with the balance owned by Essar, but under the NZM arrangement, Essar and the government would have 80% and 20% shareholding respectively.
