INDUSTRY minister Mangaliso Ndhlovu says the flour milling
arm of National Foods will not close shop after government addressed the
concerns brought by the company, which had warned of imminent closure.
Ndhlovu would not disclose the details of the arrangement,
saying the matter was highly sensitive. National Foods chief executive Michael
Lashbrook was not immediately available for comment.
“What I can say about National Foods is that we had
discussions last (Tuesday) night with them and the Reserve Bank of Zimbabwe,
and the issues that they had raised were all resolved and the agreement was
that they will not be closing as they had indicated,” Ndhlovu said.
“We are very optimistic about the economic outlook and the
period leading to ZITF (Zimbabwe International Trade Fair). I want to believe
the measures that government is putting in place are aimed at fiscal
consolidation and addressing the challenges that we are facing throughout,
leading to October. We have decided as government that we will not perpetuate a
situation that leaves us disadvantaged as an economy.’’
In a widely publicised letter to stakeholders, Lashbrook
said the company was contemplating shutting down its mills in Harare and
Bulawayo on December 5.
“Due to the delays in repatriating payments to our foreign
wheat suppliers, our suppliers have today instructed National Foods to
immediately cease draw-down of wheat stocks,” part of the letter read.
Zimbabwe is grappling with a severe shortage of foreign
currency which intensified in recent months, leading to disruptions in the
supply of fuel, drugs and other imported goods.
Ndhlovu said government was working on measures to deal
with the anticipated increase in demand towards the festive season.
“Most companies currently have challenges with foreign
currency, and we as government are doing everything we can to assist. I want
also to assure the nation that we are working closely with these companies, we
have measures in place to make sure that they don’t close. We have a draw-down
from Afreximbank and that has been activated, and the disbursements are
currently in place. So, for foreign currency allocations, we expect most of the
companies to be able to provide to the market,” Ndhlovu said.
The company is the country’s largest miller. Innscor Africa is the largest shareholder in the company
with a 37,7% stake. South Africa’s Tiger Brands controls 37,4%, while National
Foods Workers’ Trust holds 9,85% shareholding. Newsday
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