Govt scraps duty for NRZ, Air Zimbabwe

Published: 12 February 2018

The government has exempted two struggling parastatals, the Air Zimbabwe and the National Railways of Zimbabwe (NRZ) from paying duty on spare parts.

This comes as the government is seeking to revive the rail and air transport system, which has been failing to make a mark, owing to the depreciating infrastructure within these parastatals, despite being important components in the development of the country's economy.

"It is hereby notified that the minister of Finance and Economic Development has, in terms of Section 235 of the Customs and Excise Act (Chapter 23:02), made the following regulations: 1. These regulations may be cited as the Customs and Excise General (Amendment) Regulations, 2018 (No. 91). 2.

"The Customs and Excise (General) Regulations, 2001, published in Statutory Instrument 154 of 2001, (hereinafter called ‘the principal regulations') are amended in Part XIII by the repeal of Section 144 (L) and the substitution of: rebate of duty on engine spares and components of Air Zimbabwe.

"144L (1) subject to this Section and to such conditions as the Commissioner General may fix, a rebate of duty shall (with effect from 1st January, 2018 to 31 December, 2018) be granted on engine spares and components for Air Zimbabwe…," reads the Government Gazette.

NRZ's duty was also scrapped with effect from January 1, 2018 to December 31, 2019.

The two parastatals are critical in economic recovery and development as they transport raw materials, finished goods as well as export some products and transporting passengers.

Most of the infrastructure of the two parastatals has been vandalised by thieves, and the two organisations have struggled to recuperate due to lack of funding for repairs and improper management of funds, which has greatly affected capacity utilisation.

Shortage of foreign currency also affected the two important organisations that have over the years been failing to recuperate.

The rail network covers about 3 400 kilometres of which 318 kilometres is concessioned to Bulawayo-Beitbridge Railway (Private) Limited, which according to the Government Gazette has also been exempted from paying duty for its spare parts.

The rail network is designed to transport 18 million tonnes of cargo annually, but is currently carrying just under 2, 8 million tonnes a year.

The government recently secured a $400 million recapitalisation deal, which will see the reviving of the rail network through provisions of new wagons and proper rail networks.

The negotiations between the NRZ and the Diaspora Infrastructure Development Group (DIDG)-Transnet consortium on the framework agreement were completed in December last year.

The NRZ is expecting to receive 10 mainline trains, three shunting locomotives, 200 high-sided wagons and 34 passenger coaches.

In a bid to revive the transport sector, the government has also secured a $153 million loan from China the Export and Import Bank, which will be used to upgrade Robert Gabriel Mugabe International Airport.

This is critical to boost the tourism sector and trade relations between Zimbabwe and other countries.

The upgrade of the Victoria Falls International Airport in 2016 helped to improve on the number of arrivals as it can now handle wide-bodied aircraft and 1, 5 million passengers per year.

The government is also looking at expanding its airports to meet international standards, which will enable the number of arrivals to increase through the coming in of other international airlines.

At the moment, the country has three international airports, Robert Mugabe International Airport, Joshua Mqabuko Nkomo International Airport in Bulawayo, and Victoria Falls Airport.

There are also domestic airports and airstrips that could be further developed in areas such as Masvingo, Hwange, Mushumbi Pools, Bumi Hills, Buffalo Range, Kariba, Gweru and Mutare.
- Daily News