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Cold Storage Company's Books Not Audited For The Past Eight Years

1 year agoSun, 25 Sep 2022 13:38:55 GMT
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Cold Storage Company's Books Not Audited For The Past Eight Years

The Cold Storage Company’s books have not been audited for the past eight years, according to the latest report from the Auditor-General’s office.

The report on State-owned Enterprises (SOEs) and Parastatals for the year ending 13 December 2021 states that the auditor-general is still working on CSC books for the years 2013-2017.

CSC accounts for the years 2018 to 2021 have not yet been submitted to the Auditor-General.

In 2019, the government entered into an agreement with Boustead Beef, a UK-registered company owned by former Marondera farmer Nicholas Havercroft, to take over CSC’s assets and manage the meat processor’s operations for 25 years.

According to the agreement signed by then Agriculture permanent secretary Ringson Chitsiko and Boustead Beef director Nick Havercroft on 22 January 2019, Boustead Beef should have shown the government proof of funds to the tune of US$130 million four months after signing the agreement. 

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Under the joint venture agreement signed in 2019, Boustead Beef was supposed to:

1). raise and invest a minimum of US$130 million into CSC over five years, being for both capital expenditures and working capital for the business;

2). pay off CSC financial debts totalling US$42 530 597;

3). pay rentals of US$100 000 per annum during the first five years of the concession agreement;

4). take over and run the management of the following CSC ranches for an initial period of 25 years: Maphaneni; Dubane; Umguza; Chivumbuni; Mushandike; Willsgrove; and Darwendale;

5). take over and run the management of the following abattoirs for an initial period of 25 years: Bulawayo; Chinhoyi; Masvingo; Marondera; and Kadoma; and

6). take over and manage for an initial period of 25 years, the Harare, Gweru and Mutare distribution centres and residential properties of CSC.

7). increase capacity utilisation at CSC ranches and abattoir plants;

8). increase prospects for the restoration of the enterprise’s viability and higher throughput;

9). stem the further deterioration of equipment which is currently lying idle, 

10). ensure the growth of the local livestock and beef industry.

11). invest US$45 million in the first year of its operations.

Nothing of the sort happened. Instead Boustead Beef shut down the factory in September 2019 claiming it was refurbishing the plant over the next four months but it never resumed operations forcing the government to put the company under corporate rescue in December 2020.

Why is this important:

Zimbabwe used to be a huge meat exporter but exports fluctuated substantially in recent years.

Commercial beef sales once accounted for about 80% of income. At its peak, post-independence in the late 1980s, the country used to export beef worth over US$35 million, with an annual beef quota to the European market of 9 100 tonnes. In current terms, this would translate to about US$400 million, had the industry remained vibrant.

Things have drastically changed and Zimbabwe is now importing meat. In 2020, Zimbabwe imported $1.78M in Poultry Meat, mainly from Namibia ($1.18M), Brazil ($462k), and South Africa ($132k). 

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