EXECUTIVES from China Railway began combing through the National Railways of Zimbabwe (NRZ)’s infrastructure this week to get a feel of the government-controlled logistics operator’s state of affairs, before returning to the table to negotiate a US$533 million deal.
The NRZ disclosed at the weekend it had tabled the multi-million deal to the Chinese, which, if agreed, will see Beijing funding multiple areas of the parastatal, which has battled under-capitalisation for a long time.
Full details of the transaction were not available this week, but officials close to the negotiations said they were “intensive”.
NRZ spokesperson Andrew Kunambura said the deal may involve the acquisition of rolling stock and a complete makeover of Zimbabwe’s crumbling rail system.
“China Railway is in the country for talks regarding the potential deal to revamp our infrastructure and rolling stock,” Kunambura told the Independent.
“The deliberations are about the improvement of our tracks and bringing in new rail to be able to transport cargo smoothly, and then revamping our rolling stock.
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“It means new wagons, new locomotives and the refurbishment of existing ones, which are no longer working to perfection.
“During these talks we presented that, for us to be able to complete this job, we needed US$533 million. The Chinese are now carrying out feasibility studies, inspecting our locomotives, wagons and workshops to see the amount of work needed, for how much, and how long it is likely to take.
“That will inform the sort of agreement that will be entered into after the conclusion and analysis of feasibility studies by both parties,” he said.
Kunambura disclosed that there was no solid deal as yet.
“As we speak there is no solid agreement yet. But there are negotiations and they are in the country up to the end of May, assessing and carrying out that feasibility study. The outcome of that study will then inform what kind of agreement that can be entered into,” he said.
It is the latest of several attempts by the NRZ to recapitalise the business.
A few years ago, the government awarded a US$400 million deal to recapitalise NRZ to South Africa’s Transnet, which partnered a consortium of non-resident Zimbabweans- the Diaspora Infrastructure Development Group (DIDG).
However, the deal collapsed.
The NRZ said at the time it required about US$2 billion to revitalise the country's rail system.