CSC-Boustead Beef has closed its Bulawayo abattoir due to non-payment of the electricity bill. The company had claimed to have invested $24 million into the Cold Storage Company when it reopened the plant last year. However, the company failed to fulfil its agreement with the government to provide proof of $130 million in capital expenditure and working capital for the first five years, as well as failing to invest $45 million in the first year as agreed upon. As a result, the government placed the CSC under corporate rescue in December 2020.
The company continued to operate mainly at the Bulawayo abattoir despite failing to fulfil its agreement. It even claimed to have refurbished the plant and invited Vice President Constantino Chiwenga to officially reopen the factory in August last year. During the reopening, the company claimed that it had secured $36 million for a feedlot and grazing purchase scheme for communal farmers.
The CSC workers expressed their confusion about why Chiwenga and the State media believed Boustead Beef’s lies since the cold rooms were not working, and there was no way it could have invested $24 million in the plant. As a result of the company’s failure to pay its electricity bill, power was cut off on Monday, leading to the closure of the Bulawayo abattoir.
Boustead Beef entered into an agreement with the government to revive the Cold Storage Company in 2019. However, the company failed to meet its obligations under the agreement, leading to the government placing the company under corporate rescue. CSC workers have called for the government to take swift action against the company, as they believe that it is taking advantage of the government’s leniency.
This development has left the future of the CSC in doubt, and it remains to be seen how the government will react to this latest development. It is evident that Boustead Beef has not been forthright in its dealings with the government and the public in general, and this has led to the closure of the Bulawayo abattoir.
The closure of CSC means that this is just another setback in the government’s plans to revive state-owned entities like CSC, NRZ and ZISCO that were economic powerhouses in our heydays. At this point, it might just be time for the government to admit that CSC is never coming back. The Zimbabwean economy is increasingly dominated by informal businesses that are smaller, more nimble and able to adapt quickly to the adverse operating environment in Zimbabwe.
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