Zisco has massive potential

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ZISCOSTEEL has the potential to generate US$2 billion a year once the much awaited US$750 million Essar Ziscosteel deal is finalised. According to the Zimbabwe Industrial Development Policy document for 2011 to 2015, Zisco is expected to produce around 500 000 metric tonnes of steel during the first year of normal operations with a capacity of producing about 1,2 million tonnes of steel. The report says that the iron and steel giant would generate about US$2 billion over the next two years. This, the report said, would boost other productive sectors down and upstream like “mining, construction, agriculture, machinery and transport”. The revival of Ziscosteel will also result in the investment in a power plant expected to produce 90MW in capacity while the upgrading of the rail infrastructure and rolling stock were subject to mutually agreed terms with the National Railways of Zimbabwe (NRZ). Economic analysts said the resumption of operations at the giant iron and steel plant is set to improve the welfare of the workers in Redcliff and other surrounding areas. Ziscosteel was one of the major employers in the Midlands town. Under the deal, the conglomerate, Essar Africa Holdings limited will inherit Zisco’s US$340 million debt with the wage bill amounting to US$20 million of unpaid salaries. Last month, about 1 700 workers received their salaries under the new management signalling the start of a new lease of life for the workers. The iron and steel company is valued between US$40 and US$45 million. Essar now controls 54 percent stake of Ziscosteel while Government will control 36 percent while 10 percent of the shares belong to minority shareholders. The manufacturing sector is currently producing 15 percent to the Gross Domestic Product (GDP).

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