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(HERALD) Delays in transfer of US$4m from Iran stall tractor-making venture

Delays in transfer of US$4m from Iran stall tractor-making venture
By Walter Muchinguri

DELAYS in the transfer of US$4 million from Iran has stalled a key tractor-making venture being undertaken by the Industrial Development Corporation. The funds will be released in the form of a grant to Government, which will, in turn, disburse it as a loan to IDC. Willowvale Mazda Motor Industries, a subsidiary of the industrial conglomerate, will assemble the tractors at its Willowvale factory, where a separate tractor plant has been set up. IDC general manager Mr Mike Ndudzo said the delays had affected the shipment of kits to WMMI.

The setting up of the tractor manufacturing plant was already complete, Mr Ndudzo said.

He told the Deputy Minister of Industry and International Trade, Mr Phineas Chihota, during the IDC’s annual general meeting that the delays had been encountered on the Iran side as Government had done its part including opening a joint account and signing a Memorandum of Understanding with the Iranian government.

Mr Ndudzo said follow-ups had indicated that the delays were due to manpower changes within the Iranian government. Mr Chihota pledged to make a follow-up to ensure the money is released expeditiously.

Under the tractor project, to operate under the trade name Motira (Pvt) Ltd, IDC and its technical partners Iranian Tractor Manufacturing Company (ITMCO) and Dongfeng Agriculture Machinery Com pany of Iran would, in the first instance, assemble tractor kits at the WMMI plant.

They would also manage the distribution and maintenance of the tractors once they are sold.

In time, the two would be expected to invest in a foundry and forging plant to manufacture the kits and tractors locally for both the local and regional markets.

There is an overwhelming demand for tractors in Zimbabwe in view of the agrarian reform programme, which began in 2000. In his last Cabinet reshuffle in February this year, President Mugabe created a Ministry of Mechanisation and Engineering, whose mandate is to ensure farmers are equipped with the necessary implements, ranging from ploughs to tractors.

In an interview with a local daily newspaper last year Mr Ndudzo indicated that the IDC had a full order book.

He, however, said the challenge lay in converting the demand into clients’ capacity to raise the required foreign currency to enable IDC to make draw downs for the kits and to assemble the tractors locally.

Potential tractor owners would be required to pay in hard currency to enable the IDC to buy the kits.

IDC has already demonstrated its capacity to roll out the tractors when it assembled 420 tractors for the Agricultural and Rural Development Authority last year.

Labels: THE HERALD, TRACTORISATION, ZIMBABWE

posted by MrK @ 8:21 AM