NRZ’s loss widens to US$40,9 million in 2015, net liabilities at US$170,9 million
THE National Railways of Zimbabwe’s net loss for 2015 widened to US$40,88 million from US$31,6 million in the previous year contributing to a cumulative loss of US$276,43 million since dollarisation.
This comes as capacity utilisation has fallen to low levels while employees have gone for long periods without getting paid and are owed close to US$90 million.
The state-owned enterprise which is supposed to be the prime mover of freight, closed the year with net current liabilities of US$170,91 million from US$131,13 million in 2014.
Latest statistics from Zimstat shows that the bulk of NRZ’s revenue comes largely from coal freight but the Auditor General Mildred Chiri in her report notes that revenue could be higher if the railway company properly accounted for all income streams including properties.
She notes that not all tenants have been allocated individual accounts in SAP and this encourages fraud while follow ups and recovery of amounts owed by tenants occupying NRZ properties could be difficult. The audit also states that management failed to provide lease agreements for some of the properties which are supposed to provide rental income.
Operationally, Chiri notes that 50 percent of the locomotives are not working and this increases the entity’s going concern risk.
The audit also noted that NRZ has failed to meet repayment deadlines and this could affect negotiations with potential partners.
As at December 2015, the institution had overdue debts, which matured in 2007 and 2012, amounting to US$28,8 million while total debt is close to US$145 million
The rehabilitation of NRZ should take national importance if ever industry is to reap benefits from the ‘anticipated expansion’ of the agriculture and manufacturing sectors. At present, NRZ is currently pursuing PPPs for the refurbishment of the locomotives and rolling stocks while the Government is expected to continue providing funding for the rehabilitation of infrastructure in the short term. Last year 506 wagons and eight locomotives were refurbished.
Government anticipates to secure financial assistance from international lenders with the Development Bank of Southern Africa sponsored Project Information Memorandum having already been produced.
For history purposes, the country’s rail track covers 2 760km and was designed to carry 18 mln tonnes of traffic every year in 1897. The tracks are infested with cautions (equivalent of potholes) while there are no signals and telecoms as they were either vandalized or are now obsolete leading to the use of backward GPS system.
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