TINASHE MAKICHI
The Diaspora I n f r a s t r u c t u r e Development Group (DIDG) has begun construction of an R4.5bn titanium dioxide mineral beneficiation chemical plant in Richards Bay’s barely a year after government controversially cancelled its US$400m deal to recapitalise the National Railways of Zimbabwe (NRZ).
The investment in a plant in Richard Bay’s flourishing Industrial Development Zone is being done through DIDG’s associate, Nyanza
Light Metal owned by Arkein Capital and DBF Capital partners.
Arkein Capital, led by Donovan Chimhandamba and Rob Mhishi, is a significant shareholder and co-founder of DIDG while DBF is owned by former BancABC executives led by Doug Munatsi,
Beki Moyo and Francis Dzanya.
The cancellation of the NRZ deal is alleged to have been done in bad faith with allegations that Transport and Infrastructure Development
Minister Biggie Matiza cancelled the deal without following due process while ignoring DIDG’s funding package that had strong backing from Afreximbank (the lead arranger), TDB alongside the South African commercial banks and infrastructure funds.
Despite the disappointment caused by the government of Zimbabwe, DIDG- spearheaded largely by Zimbabwean Diasporas
based in South Africa has announced that it has now moved to focus on South African projects starting with the Utilities and Infrastructure that
are required by its associate company Nyanza as it pursues its landmark Titanium Dioxide pigment investment in South Africa.
Nyanza Light Metals is a manufacturer of titanium dioxide pigment and other co-products such as gypsum, aluminium and ferrous sulphate with manufacturing operations in the Richards Bay Industrial Development Zone in KwaZulu-Natal Province.
“As the country prepares to move to Covid-19 Level 3, we are continuing with our consultation with key stakeholders in different sectors of our economy. We wish to announce that the directors of Nyanza Light Metal have affirmed their commitment to continue with
an investment of R4. 5bn KwaZuluNatal,” South Africa’s MEC for Economic Development, Tourism, and Environmental Affairs Nomusa
Dube-Ncube said.
The construction of the plant in South Africa was delayed by the outbreak of Covid-19. The RBIDZ has since allocated 67 hectares of
land in Phase 1F of the estate and this chemical plant will produce titanium dioxide pigment from processing titaniferous slags and ilnenites.
More than 1,200 jobs are to be created during construction and more than 350 permanent skilled jobs during operation with another
200 semi-skilled and indirect jobs.
The construction will be in two phases. The initial phase commences immediately after lockdown rules permit will commence with the
construction of an advanced Technical Services Centre which will produce sufficient production for customer product trials.
Phase Two will commence later in 2021 and see the construction of the main plant which will produce the 80,000 tonnes per annum (tpa)
of titanium dioxide pigment. As by-products, the plant will produce 490,000tpa of gypsum used in agriculture and cement making, 125,000tpa of ferrous sulphate (Copperas) and aluminium sulphate which are used as water treatment chemicals.
The Nyanza Light Metals venture has now received R900 million worth of tax incentives from South Africa’s Department of Trade &
Industry and the South African Revenue Services (SARS).
The DIDG deal with NRZ was cancelled following revelations by Matiza that the investment firm was failing to raise funding for the
NRZ deal which is contrary to the NRZ board resolution which has not changed and endorsed the DIDG deal.
The DIDG/Transnet consortium was chosen in 2017 as the NRZ’s partner in a US$400m deal which was aimed at recapitalising
and rehabilitating the railway infrastructure.
The government, however, has since engaged Russia’s Union Wagons in bid to revive the rail company that requires more than US$1bn to realise a complete turnaround. Sources have however said that NRZ failed
to provide US$1.5m deposit for 100 wagons valued at US$10m, raising questions on how the rail parastatal would deliver a US$1bn deal with
the Russians.
The 100 wagons were supposed to have been delivered in January 2020.
In contrast, DIDG delivered 14 locomotives and 200 wagons in February 2018 demonstrating the speed and capacity of the diasporans with less complicated financing structures.
As efforts to revive the rail company are on-going, vandalism of equipment, a tanking economy, and corruption, according to people with deep knowledge of the state-owned firm are said to have destroyed the NRZ, once the bedrock of the
nation’s economy.
At its peak, the NRZ employed over 17,000 workers in the late
1980s. Today the staff compliment has dwindled to 4,600.
