INDUSTRY says the National Social Security Authority’s (NSSA) $18 million investment into the Cold Storage Company (CSC) would lead to the revival of once Zimbabwe’s industrial hub, Bulawayo.
BY MTHANDAZO NYONI
State-run pension fund, NSSA, disclosed last week that it had invested $18 million to revive CSC and the deal was expected to begin this year.
Confederation of Zimbabwe Industries Matabeleland Chapter president, Walter Chigwada, said the revival of CSC would go a long way in resuscitating Bulawayo industry.
“It will go a long way, not only in creating employment, but reviving the industry in the city. CSC and National Railways of Zimbabwe (NRZ) are very key in the revival of this economy,” Chigwada said.
Zimbabwe National Chamber of Commerce president, Davison Norupiri welcomed the development, but urged CSC management not to spread the money too thinly.
“It will be prudent for them not to spread it too thinly as it will not be good enough to buy cattle and refurbish its abattoirs across the country. A lot of money is needed to do that. However, if they are to concentrate on Bulawayo alone for the time being, and spread to other branches later, then it will work for them,” Norupiri said.
Economist Reginald Shoko told NewsDay he hoped the investment by NSSA would not be used to clear arrears.
“It (the investment) must be ring-fenced for productivity and the government must also protect the company from competition for a limited period to give it time to stabilise,” Shoko said.
“At the same time the company must explore the export market particularly to Equatorial Guinea and Angola where demand is high for its products. The current management that led the company into this state must be excused to allow others to try, (as) they failed.”
Industrialists have identified CSC, NRZ, Ziscosteel as well as the scaling up of the textile and clothing industry as key areas for revival of industry in the city.
Before it collapsed, CSC was the largest meat processor in Africa, handling up to 150 000 tonnes of beef and associated by-products a year and exporting beef to the European Union, where it had an annual quota of 9 100 tonnes.
It had a $15 million revolving payment facility with the EU and used to earn Zimbabwe at least $45 million annually.
However, the company is currently saddled with a debt of over $25 million from $9 million in 2009, mainly from fixed costs such as wages, rates and taxes on land.
It owes its 413 employees $3,5 million in salary arrears.
The CSC is reportedly making an annual loss of $6 million, stretching over the past 10 years.
The firm is now operating at less than 10% of its capacity, employing 500 workers down from 1 500 in the 1990s.