Zimbabwe’s President Robert Mugabe last week officially launched the start of work on the dualisation of the Harare-Beitbridge highway for $984 million.
The highway is Zimbabwe’s busiest and most economically significant, it is part of the North-South Corridor that directly links landlocked Zimbabwe and Zambia with access to the Indian Ocean ports of Durban and Richards Bay in South Africa.
Mugabe called the rehabilitation ‘a game changer’ with a multiplier effect for the economy. “This ground breaking ceremony is a major breakthrough as Zimbabwe forges ahead with the implementation of ZimAsset, our economic blueprint since 2013,” said Mugabe in Chirumanzu, central Zimbabwe.
Austrian contractor Geiger International was last year awarded the tender for the 580 kilometres road, which will be built under a Build-Operate-Transfer model.
Transport minister Joram Gumbo, however, said government signed a memorandum of understanding for the contract with Geiger International (GI) in 2012 but the absence of a legal framework until 2016 delayed the deal. This is despite the deal being officially announced in June last year, when government named GI and China Harbour Engineering Company (CHEC) as the tender winners for the Harare-Beitbridge and Harare-Chirundu roads.
GI vice-president Eric Geiger said the negotiations for the deal had taken six years, ‘punctuated by tenders and legal issues. “Geiger International has mobilised resources for the design and construction of the road and will be responsible for collecting maintaining the toll gates during the concession period,through a company in which government will have shares,” said Geiger.
“Proceeds from toll operations will be used to meet operating costs, loan repayments, interest, dividend payments to investors, and shareholders including the government. At the end of the concession period, Geiger will hand over the road to government, which would have to be responsible for its maintenance. Actual work on the road will start after three months if the designs are approved, he said.
Local companies will participate in the construction project to the tune of 40 percent of contract value. The project is expected to take up to 3 years under the terms of the contract. Geiger said the government had guaranteed the safety of its investment. The road was the beginning of more business deals with government, with more to follow, he added. Gumbo said more toll gates will be added on the route as Geiger seeks to recoup their investment.
Negotiations for the loan to fund the Harare-Chirundu road are not yet complete, Gumbo added.