THE government is preparing to deploy state-backed industrial finance to revive Lancashire Steel, as Harare moves to rebuild domestic manufacturing capacity and reduce a costly dependence on imported wire products.
Industry and Commerce minister Mangaliso Ndhlovu said the firm, a subsidiary of the troubled state-controlled Zisco Steel, is being prioritised for possible support from the Industrial Development Fund, in what officials describe as a broader push to convert upstream steel output into downstream industrial recovery.
“Lancashire Steel, we are prioritising them. We think they are likely to get some bit of funding from the Industrial Development Fund because the wire bars (they need) are already coming from Manhize,” Ndhlovu said.
The strategy signals a deliberate policy pivot, moving beyond exporting raw materials while importing finished industrial inputs.
Wire products, essential for construction, mining, agriculture and infrastructure, are some of Zimbabwe’s most import-dependent sub-sectors.
The result has been a persistent drain on scarce foreign currency and heightened exposure to regional supply shocks.
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“That’s the raw material that Lancashire Steel needs to then process different types of wires for our country,” Ndhlovu said.
“It’s still a huge import dependent sub sector that we want Lancashire Steel to come in and play.”
The availability of wire rod output from Manhize Steel Plant, a major Chinese-backed investment, is reshaping Zimbabwe’s industrial calculus.
For the first time in years, the country has a credible upstream supply of steel inputs that could support downstream manufacturing, provided local processors can mobilise capital, modernise capacity and compete against cheaper imports from South Africa and Asia.
Lancashire Steel once occupied a central place in Zimbabwe’s industrial ecosystem, producing wire and related products for domestic and regional markets. Its decline mirrored the collapse of Zisco Steel and the broader deindustrialisation that has hollowed out the formal economy over the past two decades.
Ndhlovu said the company now has what he described as a “bigger opportunity” to re-enter the market in 2026, as government policy pivots towards import substitution and value addition.
“So Lancashire Steel, as a subsidiary of Zisco Steel, has a bigger opportunity this year to come in here,” he said.
Officials view steel as a strategic lever for industrialisation, particularly as Zimbabwe drives an infrastructure-led growth agenda under Vision 2030.
Demand for wire products is expected to accelerate as road construction, housing projects, mining investments and power transmission networks expand.
Yet Ndhlovu was careful to frame any potential support as catalytic rather than a return to blanket bailouts.
“But again, the space is open. There are other private investors coming in,” he said.
“We always have to promote competition because it is through that that products get to the consumers cheaper.”
The emphasis on competition marks a rhetorical shift from Zimbabwe’s history of state rescues that entrenched inefficient monopolies and absorbed public funds without delivering sustainable output.
Instead, Harare is positioning the Industrial Development Fund as a catalytic financing mechanism, structured along venture capital lines to back projects aligned with national priorities such as beneficiation, import substitution and export capacity.
Ndhlovu stressed that access to State-backed funding would be conditional and subject to strict due diligence and repayment safeguards.
“They have to apply, there is a rigorous process. Remember this is administered through the Venture Capital Fund,” he said.
“We can only recommend that it is aligned with our national priorities because often times companies have used government funds and they think they are for free. We have put strict safeguards to make sure that these monies are repaid.”
Such assurances are critical. Zimbabwe is still largely locked out of international capital markets due to external arrears and a heavy debt overhang, leaving Treasury with limited fiscal space for costly industrial subsidies.
Still, the emergence of domestic wire rod supply from Manhize Steel Plant near Mvuma in the Midlands province could materially improve the economics of local processing.
If Lancashire Steel secures funding, modernises equipment and scales production, Zimbabwe could begin to displace imports, conserve foreign currency and lay the foundations for a competitive regional steel value chain.