Mishma Chakanyuka, Staff Writer 
THE CMED says it is grappling with a financial crisis due to delayed payments from government ministries and departments.
Speaking to The Financial Gazette, CMED managing director Davison Mhaka highlighted the urgent need for the government to settle its arrears to ensure smooth operations.
“The major hurdle that we face is that we provide services to government ministries and departments in the areas of road construction and vehicle hire. We also provide vehicles for elections and other national programmes,” Mhaka said.
Joshua Sacco, deputy Transport Minister
“Government delays in paying CMED have left us owed close to ZiG217 million, equivalent to US$8,5 million, by various ministries and departments,” he said.
These delayed payments have also caused CMED to fall behind on its tax obligations to the Zimbabwe Revenue Authority (Zimra), leading to the garnishment of its accounts.
“You know it is a requirement for companies to pay value-added tax (VAT) to Zimra once you raise an invoice. You have to pay after 30 days,” Mhaka explained.
“The delay in liquidating these debts from our main client is affecting us. Currently, we owe Zimra about ZWG8.1 million, including a US$322,000 component.”
CMED is appealing to Zimra to switch the company to a cash payment plan, arguing that the continuous garnishment of its accounts is disrupting business operations.
Deputy Transport minister, Joshua Sacco, acknowledged the delayed payments and assured that discussions with the Treasury were underway to address the matter.
“The Ministry of Transport and Infrastructure Development has an ongoing relationship with CMED, and yes, payments have been delayed in some cases.
“We are operating on a cash basis, relying on revenue from taxpayers,” Sacco said.
“There are no external lines of credit, all the infrastructure projects in this country are being paid for by the fiscus.
“The ministry is aware of the urgency, and talks are being held with the Ministry of Finance to expedite payments.”
Mhaka also said that CMED is working to enhance its compliance with the Public Entities and Corporate Governance Act.
“We are nearly there because the auditor-general is almost done with the 2023 audit,” he noted.
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