The re-introduction of the Zimbabwe dollar as the sole legal tender by the government in June 2019 negatively affected the multi-million dollar Egodini mall project, Bulawayo mayor Solomon Mguni has said.
Giving a review of the two years in office, Mguni said the macro-economic environment had played a huge role in delaying the project.
The local authority entered into a partnership with a South African civil engineering firm Terracotta Private Limited (TTPL) and the main contractor another South African construction company, Liviero Group, to develop a $60 million state of the art Egodini Mall and intermodal public transport interchange in Bulawayo.
TTPL started working on the project in March 2018, resulting in the relocation of vendors and public transport operators, a development which led to congestion in the central business district.
The contractors were supposed to have completed the first phase by November 2019 and after missing it they set another target for March 2020.
Mayor Mguni said after the announcement in the change in currencies, the local authority struggled to meet the contractors’ demands to settle payments within seven to fourteen days in a bid to beat inflation.
“The Macro-economic environment has affected the completion of the project such as the sudden introduction of the ZWL$ in June 2019 as the sole legal tender. Suppliers and sub-contractors who are not willing to price for periods longer that 7 to 14 days due to the prevailing inflationary environment as well as the galloping interest rates,” he said.
The mayor said the poor state of the city’s roads, was made worse by lack of funding from the Zimbabwe National Roads Administration (ZINARA).
The city`s 2389 kilometre road network needs at least US$700 million to be rehabilitates.
“The main source of funding for road infrastructure has traditionally been government allocation ZINARA and revenue accruing to council. Year on year, budget allocations have compared unfavourably with funding considered adequate to maintain road network. As a result, the road network has continued to deteriorate due to the gap between maintenance requirements and funding,” Mayor Mguni said.
“At the moment the city is struggling to procure road repair materials which include Bitumen, quarry stones, cement, road marking paint, traffic signs etc due to budgetary constraints and as such our roads remain in a poor state.”
