WHILE we applaud government efforts to revive the moribund ZiscoSteel, we are a bit pessimistic on its choice of Kuvimba Mining House, where the State has majority shareholding, as the leading investor in the dormant steelmaker’s revival.
Our pessimism is premised on government’s history of grabbing struggling but resource-rich firms and further running them down.
The government created Kuvimba in 2020 to house its interests in platinum, gold and nickel mining operations.
Zisco stopped operations in 2008 as a result of gross mismanagement and corruption.
ZiscoSteel was pivotal to the country’s development as it exported to Europe and Asia as well as neighbouring countries bringing the much-needed foreign currency to the fiscus. At its peak, ZiscoSteel was the continent’s largest integrated steelworks. It produced up to one million tonnes annually and employed about 8 000 people.
The ZiscoSteel board revealed last year that the steel company needs US$360 million to bring it back to its feet.
In 2020, the government revealed that the country was losing up to US$1 billion annually in steel imports after the closure of ZiscoSteel.
The latest bid to revive ZiscoSteel follows repeated failed attempts to do so amid corruption, cronyism and the collapse of several multi-million-dollar deals to resuscitate the steelmaker.
This, sadly, has been at the expense of thousands of lives which were severely affected through either job losses or the cessation of downstream activities emanating from the operations of ZiscoSteel.
Zimbabweans have since picked up the tab of gross mismanagement and sleaze that crippled ZiscoSteel after government pushed through the Zimbabwe Iron and Steel Company Debt Assumption Bill, under which the taxpayer was forced to absorb the steelmaker’s US$500 million debt.
The more cynical observers believe that Kuvimba is more interested in accessing the rich ore reserves rather than the Herculean task to get the steelmaker’s operation back on track.
Government has a checkered record when it comes to reviving operations of State entities, we don’t see it faring any better with the ZiscoSteel project which requires hundreds of millions of dollars to resuscitate.
The revival of ZiscoSteel, if it takes off, will be a huge boon to a country buffeted by numerous headwinds such as foreign currency shortage, a volatile exchange rate and high inflation.
However, as the saying goes, the taste of the pudding is in the eating.