Zimbabwe govt bonds raise $117m for roads

The rehabilitation of Beitbridge-Harare highway and other road projects got a major boost after Government raised $117 million from two separate bonds it floated in the market.

A $150 million Infrastructure Bond floated by ZB Bank, which has already raised $62 million will be ring-fenced for the Beitbridge-Harare highway with Treasury bringing in an additional $50 million.

Work on the road is already in progress with three detour roads having already being opened while an asphalt overspray on Harare-Bindura Road is progressing well with the contractor Bitumen World working on the road.

A $150 million bond, floated by CABS/Old Mutual, has raised $55 million, which will be allocated to other road projects.

According to the 2019 Infrastructure Plan released by Treasury last year, the rehabilitation of the roads through private-public partnerships has been difficult, hence the switch to seek financing from the domestic market.

Transport and Infrastructure Development Deputy Minister Fortune Chasi said road infrastructure was at the epicentre of the country's economy hence the need to urgently rehabilitate the country's roads.

"We are working passionately to ensure that we provide transmission mechanism for the economy in terms of goods and services. Without roads we cannot achieve the 2030 vision, but we are also looking at critical rural road infrastructure which has not received sufficient attention in years.

"In fact, it has been relegated to rural district councils. We are interested in ensuring that there is an improvement in that area because vehicle population in the rural areas has improved both private cars and heavy vehicles. We want to give necessary support to rural communities."

Zimbabwe National Road Administration (Zinara) corporate communications manager Mr Augustine Moyo said Zinara had successfully repaid its maiden one-year bond hence positive response from the market.

"Government's Roads Reclamation and Development Programme, which is already underway, seeks to reclaim and transform our roads into a world class network.

"It is against this background that Zinara has mobilised $62 million from the $150 million Infrastructure Bond for 2019," he said.

"The $62 million has already been disbursed to the Department of Roads for the Harare-Masvingo-Beitbridge highway. We also currently have another approved bond for roads with CABS/Old Mutual of $150 million, of which we have raised $55 million on a private-placement basis. These are two-year bonds."

"Zinara has lobbied Treasury to increase investment in roads through the Inter-Ministerial Economic Roads Rehabilitation Programme, which is chaired by permanent secretary in the Ministry of Finance and Economic Development Mr George Guvamatanga."

The TSP document states that the comprehensive Roads Development Programme, with support from the fiscus, is targeting upgrades from gravel to bituminous surfacing at an average cost of US$500 000 per kilometre. The target is to complete 20km for each gravel road every year until completion. Through the fiscus, over US$250 million has been released for roadworks.

Minister Joel Biggie Matiza says the roads should be done properly and there is need for quality control as Government was not interested in "seeing just black tar".