Some Zimbabwean company executives have reacted angrily to revelations that the long-awaited $40 million Distressed and Marginalized Areas Fund launched last October is non-existent as government has failed to provide part of the money to bail out companies.
The executives, mostly from the second city of Bulawayo, where over 80 firms collapsed between 2009 and 2010 leaving 20,000 workers jobless, said it was unthinkable that government is failing to pay out $20 million as promised while Old Mutual Insurance (Pvt) Ltd has already met its financial obligations.
They said failure by government to act was an indication it lacked commitment to rescue collapsing industries in the region, neglected over the years by President Robert Mugabe’s Zanu-PF government.
Kevin Terry, Central African Building Society managing director, told Parliament this week that the fund is not only for Bulawayo companies but meant to benefit distressed firms countrywide.
Terry said from the $20 million deposited into CABS by Old Mutual, $43,96 million has so far been disbursed to six companies and “we have additional applications for $17,9 million from 31 institutions”. Seven applications have so far been rejected.
Bulisani Ncube, Bulawayo manager of the Zimbabwe National Chamber of Commerce said company executives are concerned by lack of government commitment in rejuvenating industries in the city.
“Despite these drawbacks we hope state bureaucracy will not force treasury to take another six months to release the funds to CABS,” said Ncube.