Mtapa Investment Fund (MIF) Deputy Investment Officer Enerst Denhere has indicated that they are not going to rush into the idea of unbundling the National Railways of Zimbabwe (NRZ), adding that several strategies still need to be implemented before the idea can be entertained.
Legislators from the Public Accounts Committee (PAC), which is on a fact-finding visit to some of the parastatals under the Mtapa Investment Fund (MIF), had suggested that NRZ should consider unbundling and focus more on areas where it has strength.
Currently, NRZ owns the railway infrastructure, carries out maintenance, and conducts freight operations. Legislators are of the view that this model is unsustainable given the current state of the parastatal.
However, Enerst Denhere indicated that while unbundling has been implemented in other markets, a lot still needs to be done at NRZ to enable them to weigh the benefits of unbundling against the benefits of remaining an integrated company.
‘’There was a question on plans to unbundle NRZ. At the moment, NRZ is an integrated company. By that, we mean it owns the infrastructure, the railway tracks, performs maintenance in the workshop that we visited, and it also does the freight operations.
‘’So when we talk of unbundling, as has happened in other markets like South Africa, where they have split up the infrastructure from freight operations, we think with NRZ, given the three phases that we spoke about in our strategy — Stabilisation, followed by Growth and Expansion — the idea is to fully divisionalise that infrastructure side from the freight operations and then make sure we come up with frameworks that allow predictable opening of access to third parties.
‘’And then gradually we will be able to see whether we can fully unbundle NRZ versus the merits of a fully integrated NRZ,’’ he said.
Speaking at the same occasion, Public Accounts Committee Chairman Caston Matewu said his committee wants to see NRZ returning to its core mandate and introducing more goods trains.
‘’We want to see an NRZ that has lots of goods trains across the country. We want a vision where we see high-speed rail being introduced in Zimbabwe.
‘’We want to see that in our towns we have trams and light rail that would service smaller towns. This is the vision we want to see in NRZ. We want to see it going back to its core mandate,’’ said Matewu.
Meanwhile, Denhere also told parliamentarians that traffic capable of transforming NRZ’s fortunes is available in the country, and that what is needed is to shift it from road to rail.
He added that there is a need for a serious conversation among various government stakeholders, including the Ministry of Transport, Zinara, and the Ministry of Finance.
‘’Dinson Iron and Steel Company is moving almost 2 million tonnes annually on road. If we could get those on rail, that is a commercial customer.
‘’The traffic is there, it’s just an issue of shifting it from road to rail, and we need to be talking about incentives for bringing customers onto rail.
‘’How can we do it? Is it through a levy? Do we have to work hand in hand with Zinara, the Ministry of Transport, and the Ministry of Finance to make sure they do not just pour money into roads, but also into rail rehabilitation?
‘’So these are the things we need to be talking about,’’ he said.