News / National
Govt eyes $25m Zupco bus deal
24 Jul 2014 at 09:01hrs | Views
GOVERNMENT is negotiating a US$25 million loan agreement with the Eximbank of India to buy 500 buses to revive the Zimbabwe United Passenger Company's operations. Local Government, Public Works and National Housing Minister Ignatius Chombo disclosed this when he appeared before the Parliamentary Portfolio Committee on Local Government, Public Works and National Housing yesterday.
The parastatal has not received any significant capitalisation from the Government for the past 30 years.
Its operations declined since the liberalisation of the public transport system in the 1990s when private players came into the fray.
"Faced with the current situation, the ministry has put in place strategies and solutions to create order and curb pollution, especially in major urban areas.
"The ministry is currently facilitating loan access to Zupco of US$25 million from Eximbank of India to purchase 500, 65 seater high volume Leyland buses.
"This will enable the sector to move from para-transit modes to mass bus transit modes. The draft Memorandum of Understanding has been sent to the Attorney-General's office for their scrutiny," Minister Chombo said.
He said his ministry had proposed the phasing out of kombis as contained in the National Transport Policy being compiled by the Ministry of Transport and Infrastructure Development.
The policy, Minister Chombo said, would also compare the country's transport system to those in other countries
At its peak in the 1970s, Zupco had a fleet of 2 800 buses.
The fleet has dwindled to 300 buses.
"Zupco has struggled to maintain its old lead role in the public transport faced by stiff competition from kombis, regular buses, which load anywhere, and move faster than the conventional buses.
"This predicament was worsened by lack of capital injection into Zupco for the last 30 years to enable it to maintain an appropriate fleet to meet its obligations. The company has had no access to Public Sector Investment Programmes funds nor Government guarantees," Minister Chombo said.
Legislators grilled Minister Chombo over allegations that he favoured his home province of Mashonaland West when appointing people to the Zupco board and senior management positions.
He denied the allegation saying the ministry only considered expertise when making appointments.
"We only look at expertise and skills that one can bring when making the appointments and not one's origins," Minister Chombo said.
The parastatal has not received any significant capitalisation from the Government for the past 30 years.
Its operations declined since the liberalisation of the public transport system in the 1990s when private players came into the fray.
"Faced with the current situation, the ministry has put in place strategies and solutions to create order and curb pollution, especially in major urban areas.
"The ministry is currently facilitating loan access to Zupco of US$25 million from Eximbank of India to purchase 500, 65 seater high volume Leyland buses.
"This will enable the sector to move from para-transit modes to mass bus transit modes. The draft Memorandum of Understanding has been sent to the Attorney-General's office for their scrutiny," Minister Chombo said.
He said his ministry had proposed the phasing out of kombis as contained in the National Transport Policy being compiled by the Ministry of Transport and Infrastructure Development.
The policy, Minister Chombo said, would also compare the country's transport system to those in other countries
At its peak in the 1970s, Zupco had a fleet of 2 800 buses.
The fleet has dwindled to 300 buses.
"Zupco has struggled to maintain its old lead role in the public transport faced by stiff competition from kombis, regular buses, which load anywhere, and move faster than the conventional buses.
"This predicament was worsened by lack of capital injection into Zupco for the last 30 years to enable it to maintain an appropriate fleet to meet its obligations. The company has had no access to Public Sector Investment Programmes funds nor Government guarantees," Minister Chombo said.
Legislators grilled Minister Chombo over allegations that he favoured his home province of Mashonaland West when appointing people to the Zupco board and senior management positions.
He denied the allegation saying the ministry only considered expertise when making appointments.
"We only look at expertise and skills that one can bring when making the appointments and not one's origins," Minister Chombo said.
Source - The Herald
