Economy longs for Zisco revival

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ZIMBABWE’S economy is yearning for the revival of the Zimbabwe Iron and Steel Company (Zisco) whose inactivity over the past decade has created a serious gap in the local industry.
Zisco, which was once the largest integrated steel works in the region, closed in 2008 and industry is hoping that the latest revival bid involving a Hong Kong-based company comes to fruition.
The effects of the company’s collapse were immediate as a number of businesses had relied on dealings with the country’s once biggest foreign currency earner.
Jairos Mushirivindi, the managing director of Zimbabwe’s only civil explosives manufacturer GML Explosives ― formerly Dyno Nobel ― said the company shut down in 2008 following the collapse of Zisco. It was subsequently taken over by a consortium of Croatian businessmen and re-opened in 2014.
“If GML Explosives is granted national strategic company status it can make Sable Chemicals run full throttle 12 months a year because we consume 80 percent of their products, which include ammonium nitrate that we use for our explosives,” he said.
“If Sable Chemicals is at full throttle, it will be producing oxygen for Zisco as it comes back to life. So, there is a linkage between GML Explosives, Sable Chemicals and Zisco” Mushirivindi said recently.
Increases in fertiliser prices over the past 10 years have been partly attributed to the disintegration of the link among Zisco, GML and Sable Chemicals.
“There is the issue of the mining industry. This will be solved if we sort out Zisco because its existence made explosives to be manufactured. That is why we have companies like Dyno Nobel because Zisco enabled it to harness hydrogen produced at Sable Chemicals,” former Binga South legislator Joel Gabbuza said in parliament recently.
“Now, Sable Chemicals is very key to our agriculture because it is the sole manufacturer of ammonium nitrate fertiliser from the simple method of trapping the air which we breathe, separate it and produce fertiliser, but for them to do that they need the assistance of Zisco because it used to buy oxygen produced as a by-product and if they bought that oxygen, it lowered the price of ammonium nitrate fertiliser. That is why whites on farms were able to produce at a low cost and were able to export. So, Zisco is still very key to the economy of this country,” he added.
Hwange Colliery Company Limited (HCCL) used to supply Zisco with huge amounts of coking coal daily but since the collapse of the steel producer, it has been struggling, recording a string of losses which management says has dragged it into an appalling net liability position of more than $200 million.
As efforts to rescue Zisco progress, experts say this would give the company better chances of survival.
The collapse of Zisco also distressed the National Railways of Zimbabwe (NRZ) as it was heavily dependent on the steel company.
Some industries now import raw materials such as steel billets, which were previously manufactured at the Redcliff-based firm. Apart from steel billets, local foundries are also reportedly importing ferrosilicon and ferromanganese.
In the face of serious foreign currency shortages in the country, some of the companies that had relied on Zisco have been forced to scale down operations while some have shut down.
Steelmakers Midlands Metal and Haggie Rand are some of the companies that have downsized their operations.
In May this year, President Emmerson Mnangagwa assented to the Zisco Debt Assumption Bill enabling government to take over the company’s $500 million of debt to pave the way for Hong Kong-based Tian Li to acquire the company.
At its peak, Zisco was the largest integrated steel works in Africa with a capacity to produce one million tonnes of steel annually.