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Zim woos SA infrastructure investors

Harare - Zimbabwe is to open up its infrastructure sector to public private partnerships (PPPs). The announcement came shortly after a visit to the country by executives from Transnet, the Development Bank of Southern Africa (DBSA) and the Public Investment Corporation (PIC).
 
SA’s struggling northern neighbour has been hard hit by poor rail, road and electricity infrastructure and is now scrambling for measures to narrow the widening infrastructure deficit that experts say is deterring investors.
 
Part of these measures include inviting international investors and financiers to sink money into infrastructure projects and opening up the sector to PPPs, as well as wooing investors from China and Russia.
 
“With the revised toll fees, we are anticipating that Zinara (the Zimbabwe National Roads Administration) will be able to mobilise about $102m for this year. But even then, when you look at $102m compared to about $5bn that you need for total intervention, it still leaves scope for PPPs,” said Munesu Mudodawafa, permanent secretary in th
transport ministry in an address to a Harare mining conference on Thursday.
 
Group Five is currently involved in the country after being contracted to rehabilitate the major highway linking Botswana and Mozambique and running through Harare at a cost of $207m. The DBSA is funding this road infrastructure development project.

READ: SA bodies want to fund Zim infrastructure
 
Munodawafa said upgrades to Zimbabwe’s road network require investments as they are “not viable on their own”. The road linking Chirundu on the border with Zambia and the Beitbridge border town linking Zimbabwe to South Africa “is the (only) road that can only pay for itself”.

Government officials said Zimbabwe requires more than US$60m to upgrade its dilapidated rail infrastructure. The National Railways of Zimbabwe said on its website that it is looking for investments through PPPs and other investment options.

Executives from Transnet and the PIC visited Zimbabwe last month. Finance Minister Patrick Chinamasa has asked for lower investment rates from the South African firms. If approved, the investments would be channelled towards infrastructure development.

“We believe that for significant progress to be registered, there is scope for PPPs in the road transport sector. There is work in progress to put a legal framework (in place) for the PPPs,” said Mudodawafa.

The country’s treasury has previously said it is to issue a $100m bond for infrastructure development. However, efforts to attract new investments into the country’s economy have been stalled by its debt overhang which has now ballooned to a total of nearly $10bn, according to Chinamasa.

 - Fin24

NOW READ: SA firms to fix Zim infrastructure woes
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