…. as vultures milk firm dry

01 Dec, 2017 - 10:12 0 Views
…. as vultures milk firm dry

eBusiness Weekly

Business Writers —

The National Railways of Zimbabwe (NRZ) – a key player in the country’s economy through provision of affordable transportation – was fleeced of the bulk of its assets dotted across the country and abroad worth tens of millions of dollars, it has been learnt.

Blatant abuse of authority, which has become synonymous with most State Enterprises and Parastatals, is blamed for the alleged creaming off of NRZ’s assets by some managers and high ranking Government officials. NRZ management has since admitted that there has also been lack of supervision of the firm’s assets resulting in some unscrupulous individuals and senior officials looting them, and/ or the rentals that accrued from the buildings.

The railway company, which was founded in 1897 and the richest for sometime in central Africa, is key to moving goods at lower costs, but has been struggling to attract investors to resuscitate its operations due to its precarious financial position. Some of NRZ’s properties – which are estimated at over $150 million – include guest houses in the country’s low density suburbs, thousands of hectares of forest land, vast tracts of idle land, church and residential stands as well as plots and farms to rear livestock and grow crops.

NRZ also owns thousands of hectares of developed commercial stands, undeveloped commercial bays and land with supermarkets and safari farms, and a “significant” stake in Pan African Minerals Development Company (PAMDC), among others.

PAMDC – which was created in 2007 to take over the mining concessions previously owned by ZIZA, a group that was jointly owned by the railway companies of Zambia and Zimbabwe – has diamondiferous concessions in South Africa. NRZ is also understood to have several other properties in the United Kingdom and some parts of Europe.

However, despite the plethora of assets, NRZ has a weak balance sheet to the extent that it had become exceedingly difficult to attract investors to resuscitate its operations. It is only recently that NRZ signed a pact with the Diaspora Infrastructure Development Group (DIDG), and South Africa’s Transnet, which have lined up a $400 million deal. NRZ general manager Lewis Mukwada, told the Business Weekly that the properties have gone for years without proper supervision, adding that there was a possibility of massive underhand dealings involving the assets.

Mukwada said after suspecting that NRZ was being fleeced of revenue, a team was swiftly set up to embark on around the country establishing all properties that belong to the company, and the extent to which the firm might have been prejudiced. Efforts are already underway to extract value from the assets that were discovered, as management accelerate attempts to restore NRZ as the “mover of the nation”.

“We set out a team to go countrywide and verify our properties physically. We have land and properties all over the country but there has not been maximum supervision.

“On the way, we identified commercial buildings that can be exploited. The aim now is to unlock value,” said Mukwada.

Business Weekly has gathered that former NRZ general manager, the late Air Commodore Mike Karakadzai, allegedly transferred some of the company’s properties into his name. Although the nature of the properties could not be ascertained by the time of going to print, it is understood that Rtd Air Commodore Karakadzai took advantage of the fear he had allegedly instilled into subordinates to plunder the firm’s resources without anyone complaining about it.

Rtd Air Commodore Karakadzai is widely remembered in the country in general, and Bulawayo in particular, for living a lavish life-style punctuated by flamboyant vehicles at a time when the company was struggling to pay employees. By the time of his death in August 2013, NRZ was owing employees up to $80 million in unpaid salaries.

The salary arrears have since risen to about $100 million and it is expected that once the new investor commits funds into the project, employees would be the first to get their dues.

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