eBusiness Weekly
Michael Tome
The GOVERNMENT says it will in 2023 prioritise the parastatal reforms agenda guided by the Short to Medium Term Reform Framework (SEPs-SMTRF) and the National Development Strategy 1 (NDS1) as it strives to moderate the enterprises’ load on the fiscus and promote efficiency.
The programme intends to bring about engagement of strategic partners for several government-owned entities like the Infrastructure Development Bank of Zimbabwe (IDBZ), POSB, and firms under the Industrial Development Corporation (IDC).
It also envisages the merger of Powertel, Zarnet and Africom while Broadcasting Authority of Zimbabwe (BAZ) will be integrated with the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ).
Over the years, the government has devised investment vehicles and collaborated with private sector players through joint ventures, to invest in various sectors of the economy.
According to Treasury, the move also aims to complete the disbanding of all subsidiary boards for ZESA Holdings and allow Zimbabwe Power Company (ZPC) to engage strategic partners for its power generation projects.
Power generation remains a challenge in the country and requires clear strategic planning to come up with a sound energy sector capable of sustaining the growing demand for energy in the country’s industry.
Likewise, under the energy sector fuel distributors, Genesis and Petrotrade are earmarked for a merger.
In his 2023 National Budget Statement, Finance and Economic Development Minister, Professor Mthuli Ncube noted that the government earmarked the completion of the state enterprises reforms.
“State Enterprise and Parastatals reforms have been guided by the SEPs Short to Medium Term Reform Framework (SEPs-SMTRF), the National Development Strategy (NDS) 1 and Vision 2030. Government has over the years created investment vehicles and partnered private sector players through joint ventures, to invest in various sectors of the economy, especially the mining sector.
“Drawing lessons from the successes and challenges faced in implementing the SEPs-SMTRF since 2018, it is envisaged that the SEPs reform priorities for 2023 will be guided by the completion of the on-going SEPs reforms,” said Mthuli.
He also signalled intention for capital raising strategies for Silo Foods, ZUPCO and Allied Timbers and implementation of the short-term recapitalisation strategy of the National Railways of Zimbabwe.
Previously during his proposal of the NetOne and TelOne transactions, Minister Ncube said they would be sold with the Government retaining 40 percent shareholding.
However, it is understood that the two companies are now on hold with those plans after NetOne and TelOne failed to raise the US$5 million needed by Pricewater-Coopers (PwC) who were the transaction advisers.
In that regard calls have grown for a consolidation of both companies in order to create a bigger company that has a big capital base and a wider customer pool.
Some have gone as far as saying the two state-owned firms should in their plan integrate a bank in the consolidation so as to make capital raising easier.
One of the companies earmarked for privatisation, the Industrial Development Corporation of Zimbabwe (IDCZ) has hinted on recapitalizing the local basal (Compound D) fertiliser value chain as it fights to stay afloat and remain profitable.
This year alone IDCZ has invested in excess of US$5 million in setting up new plants and equipment for fertiliser production.
