INDUSTRY and Commerce minister Mike Bimha yesterday told Parliament that the executive vice-chairman of Essar Steel, Firdose Vandrevala, was expected in Harare this week to reassure the nation that the Indian firm was still committed to the New ZiscoSteel project.
This was after Kambuzuma MP Willias Madzimure (MDC-T) asked if the agreement between ZiscoSteel and Essar was still valid.
“Government is committed to operationalising ZiscoSteel and sometime this week the Essar vice-chairman will be visiting Zimbabwe to reassure the nation that Essar is still committed to see the realisation of this project,” Bimha said.
“The second reason for his visit is to witness the closure of the transaction, because once the transaction is closed, work commences.”
Bimha, however, denied allegations that the iron and steel company had remained dormant because the funds deposited by Essar to resuscitate its operations had been abused.
“It is not true. The agreement states that the investor, who is Essar, will take over the external creditors in Germany and China and that the government of Zimbabwe was going to fund local creditors.
“It is also part of the agreement that Essar as investors will put money into rehabilitation of Zisco and start operations. Therefore, there is no money required prior to closure of transaction. It is only after closure of transaction that Essar will start putting money,” he said.
“Two factors stalled the project last year and the first one was the state of affairs with regard to equipment at New ZiscoSteel where there will be construction of new plants alongside what we have. It is no longer an issue of rehabilitation, but more of constructing new plants. That entails a lot of work in terms of planning and making orders of the new equipment and machinery.”
He said the investors were pushing to conclude the agreement within the next three weeks.
Bimha also said management at ZiscoSteel was working to resuscitate the company’s subsidiary, Lancashire Steel.