Hwange Colliery secure Indian loan to import equipment

Hwange Colliery Company has recently secured a loan from India to import equipment as a recapitalization programme meant to boast production at the parastatal.

This emerged during the parliament seating on February 10 when MP Prince Dubeko Sibanda asked the deputy minister of Mines and Mining July Moyo over the government's plans to extinguish the company's debt.

"Minister you said that you have made plans to extinguish the debt that the Hwange Colliery Company has. However, Minister, we understand that recently, you approved the increase of the debt by Hwange Colliery Company through allowing the importation of equipment from India through a loan from the Export and Import Bank of India of which the equipment was found to be unsuitable for use at the colliery company," said Sibanda.

"How do you align? Is that not an inconsistency that you are trying to extinguish a debt and at the same time creating another which might have been done in some kind of another debt which might have been done in some kind of a corrupt manner."

Moyo said the importation of the equipment which was capital investment was done by the company, board of directors and management without the shareholders necessarily being directly involved.

"We are now discussing the intervention of shareholders now because the company is being threatened with judicial management and liquidation. So, I am discussing issues past the point where the company's going concern is now threatened," he said.

"Yes, the issues that happened upstream of that have been raised, concerns from this House have been taken and we are going to be looking into that issue as well. But, I am talking of preempting potential company exposure in its going concern aspect."