GOVERNMENT is considering concessioning out major highways to private sector players to unlock sustainable financing of road construction and rehabilitation projects with the participating investors expected to recoup their money through tolling fees over a period of up to 30 years.
Private contractors have welcomed the idea saying this would afford them an opportunity to contribute meaningfully to national development while helping the Treasury ease the burden and create considerable fiscal space for other key interventions.
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Book NowWhile Government has been driving robust infrastructure development under the Second Republic, the financing gap remains wider and unsustainable for a country reeling under the yoke of sanctions. Most roads have outlived their lifespan resulting in some sections of the highways being littered with potholes that make driving a nightmare.
The Beitbridge-Bulawayo-Victoria Falls Highway, an important route connecting Zimbabwe with other Sadc countries via Beitbridge Border, is one of the affected. With the onset of rains, and over-usage by haulage trucks overloaded with coal and copper, these have taken a toll on roads.
Speaking at the inaugural Matabeleland North Diaspora Investment Conference, which ended on Saturday, Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, said going forward, the ideal situation was to concession trunk roads to the private sector who should build them and recover their money through the toll system.
He was giving an update on the state of the road network and responding to a proposal made by participants for Government to consider allocating sections of the road to some coal mining companies to repair and use that as a condition for renewal of their licences.
The concern comes on the back of observations that haulage trucks are largely blamed for damaging major roads, especially the Victoria Falls-Bulawayo-Beitbridge Road.
Professor Mthuli Ncube
Prof Mthuli acknowledged that highways like this one could only be sustainably rehabilitated through private-public partnerships (PPPs), which should augment initiatives such as the Government’s Emergency Road Rehabilitation Programme.
He noted that limited fiscal space has hindered desired progress on major projects across the country hence the move to embrace the concession model, which could be on a build-operate and transfer (BOT) arrangement.
“There is no reason why this road (Beitbridge/Bulawayo/Victoria Falls) cannot be concessioned out. We are concessioning out trunk roads, which are profitable,” said Prof Ncube.
“What will be viable is that the whole road from Beitbridge to Victoria Falls should be in private hands. It should be in PPPs. We should give investors 25-to-30-year concessions so that they invest in the road further, manage it and do enough tolls to recoup their money and surrender it to Government.”
The minister said developing a sound road network was a critical investment opportunity in its own right hence a similar concession model was being considered for key road projects such as Fighting Road, which connects Lupane to Kwekwe via Nkayi.
Government has successfully rehabilitated the Harare-Masvingo-Beitbridge Highway, which is about 80 percent complete with 470km out of the total 580km of the road now opened to traffic.
The road and modernisation of the Beitbridge Border Post to bring in efficient systems aimed at reducing or eliminating delays, are some of the signature projects of President Mnangagwa’s administration through private sector partnerships.
Government is on record saying the Beitbridge-Bulawayo-Victoria Falls highway will be rehabilitated fully next year after completion of the Beitbridge-Masvingo-Harare-Chirundu, which is underway and contractors are being engaged. The Plumtree-Mutare Highway was financed through a similar model during the Inclusive Government.
The entire north-south corridor has been divided into three sections: the 580km Harare-Masvingo-Beitbridge highway together with eight toll plazas, the 342km Harare-Chirundu highway with six toll plazas, and the 59km Harare Ring Road with three toll plazas. These tolls are aimed at paying for the rehabilitation and maintenance of roads.
Government contracted five different and local contractors to repair the road which is a key connector to the north-south corridor.
Transport and Infrastructural Development Minister Felix Mhona is also on record saying the Government would also work on other feeder roads linking various towns and ease pressure from the trunk roads.
Commenting on the concession model, private contractors said the model was welcome and demanded clarity on how potential investors would recover their monies. The president of Zimbabwe Building Contractors Association, Mr Petros Kagwere, said the concession model was workable as it enhances partnerships between Government the private sector. He said most infrastructure projects in other countries are private sector driven.
“It’s a workable model and I think what Government is saying is that let’s have a win-win situation giving the private sector an opportunity to use its money and recover it through toll fees and then hand over to Government after recovering the money for further maintenance,” he said.
“It is every citizen and private sector’s role to participate in the growth of infrastructure and develop their countries and benefit citizens.”
Mr Kagwere said private sector players have the capacity to drive the projects as they have financial resources and skilled human resources and equipment .
By roping in the private sector, he said this will unlock higher economic transformation for the country and enhance attainment of Vision 2030.
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