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Govt to aid construction sector on critical imports

Deputy Minister of Transport, Communications and Infrastructure Development Tich-aona Mudzingwa told Standardbusiness that his ministry appreciated the problems faced by the construction sector and would facilitate the importing of critical equipment.

He cited as an example the ongoing rehabilitation of the Harare-Masvingo road near the Mukuvisi bridge which was taken up as a government project after the local sector showed apathy towards the project.

“They (private sector) were not forthcoming and we know that it’s not their fault, they have no finance,” he said.
Mudzingwa suggested that local companies should approach his ministry if they needed assistance.

“They may need to import construction-related equipment like bulldozers and graders, this is where government can chip in to make importing conditions favourable by granting such equipment duty-free status for instance,” said Mudzingwa.
“We are encouraging the private sector to approach us in that regard,” he said, adding that this would lead to technology transfer.
He ruled out any prospects of government financing.

Mudzingwa said government infrastructure projects would be ongoing considering the massive rehabilitation of transport networks and related building maintenance that urgently needed to be done next year onwards.

A local construction company, Sim-Bay Maintenance (Pvt) Ltd said local companies should be given priority over foreign firms in the awarding of contracts. Sim-Bay Maintenance managing director Wellington Dhorobha said many local companies were facing great difficulty in accessing contracts.
“Opportunities are limited because preference is being given to Chinese contractors who are well-capitalised,” said Dhorobha.

“All things being equal, with sufficient government support, we can deliver on projects in a timely manner while creating employment for Zimbabweans.”
According to the African Development Bank, Zimbabwe needs US$16 billion for the rehabilitation and development of its national infrastructure in order to achieve its projected economic recovery and growth targets. Planet Building Contractors (Pvt) Ltd managing director, Daniel Garwe said the local construction sector has been lamenting the same challenges for the past decade.

“Capacity utilisation is still below 25%, we have limited or no access to affordable finance, as well as obsolete plant and equipment,” said Garwe who is the immediate past president of the Construction Industry Federation of Zimbabwe.

He said most foreign companies that the local construction sector is competing with enjoy massive subsidies from their governments making it easier for them to win tenders.

“Government must be made aware of the fact that economic turnaround begins with the built environment. There is a need to accept and embrace stimulus packages for the local sector,” said Garwe, adding that the introduction of supportive legislation would go a long way towards reviving the sector.
“Government could also make arrangements with banks to provide local companies with access to finance with favourable payment terms,” he said.

Some companies have reported that their 2012 books are in good order following a sudden surge in government-related expenditure on infrastructure and construction projects.

Before February 2009, Zimbabwe’s construction sector suffered the devastating effects of a protracted political impasse between the country’s contending parties leading to a massive flight of foreign capital.

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