Zimbabwe Government Urged to Rethink on Bidders For Collapsed State Steel Maker
Steel industry experts said that Harare misfired when it dumped the South African subsidiary of global giant ArcelorMittal following that firm’s earlier successful bid for ZiscoSteel
The Zimbabwean government should reconsider its decision to seek a medium-sized partner instead of a large international corporation to restructure and recapitalize the Zimbabwe Iron and Steel Company or ZiscoSteel, economists and business analysts say.
Steel industry experts said Harare misfired when it dumped the South African subsidiary of global giant ArcelorMittal following that firm’s earlier successful bid.
They said a smaller company will not have deep enough pockets to pay creditors, invest millions of dollars, update technology and revive production after two years of downtime at ZiscoSteel.
They noted that the government wants to maintain a tight grip on ZiscoSteel even if the new strategic partner takes a controlling stake in the insolvent state enterprise - not a formula for a smooth partnership.
Economist John Robertson told VOA Studio 7 reporter Gibbs Dube that the government must develop sounder policies when privatizing or restructuring troubled parastatals like ZiscoSteel.
Economic commentator Rejoice Ngwenya said it is unlikely the government will find the kind of medium-sized strategic investor for ZiscoSteel that it says it is seeking.