Artist Ray Boltz in his song The Anchor Holds paints a picture where he says even when a ship seems battered, the anchor holds.
This ties in perfectly with what indispensable Wicknell Chivhayo has been through over the last few years.
Battered by bad publicity over the Gwanda Solar Project, a marauding parliamentary committee, among other storms, Chivhayo, an astute businessman, navigated his way through the storms leading to a breakthrough this week. Chivayo’ partners Chint Electric has committed a $52million advance payment demand guarantee for the 100megawatts Gwanda solar project that pessimists had written off and crucified Chivayo.
Chivayo however stood his ground even before Parliamentary Portfolio Committee where he maintained that his hands were clean.This development will unlock funding needed for the development of the project.Chivayo’s partners who boasts of an annual turnover of $12billion,made a commitment to provide a guarantee covering 30percent of the engineering procurement and construction (EPC) aspect of the contract.
The Zimbabwe Power Company (ZPC) is the contractor and Chivayo therefore is the conduit between the large Chinese engineering firm and government by virtue of being the local partner. The solar project is just but one of the several national strategic power projects set to alleviate power shortages in the country. Chivayo’s partners submitted that upon receipt of the advance payment demand guarantee,ZPC is contractually obliged to pay 30 percent of the EPC project cost ,less $7.4million advances it would have paid for precommencement works.
Chint resolved to make this proposal after noting progress by Chivayo (Intratek MD) on the pre commencement works and needed immediate EPC funding (or part thereof) to perform the works.Completion of pre commencement works then technically clears Chivayo and ZPC from the contentious $5million payment(without bank guarantee) that grabbed headlines and set social media abuzz with speculative reports.
In fact since ZPC is supposed to pay $7,4 million for pre commencement works,it will owe $2.3million on completion of ground clearing and all initial works. According to Chivayo’s technical partner Dr Lin Bosheng (Chint Electric vice president), this latest development was above board and provided for in clause 5b of the Contract Agreement for the project. Intratek Zimbabwe executive chairman Wilson Manatse said the new dispensation had brought hope to all “Zimbabweans, consequently successful implementation of the project was inevitable.”
Intratrek is expected to complete pre-commencement works for Gwanda in the next three to four months and these included completion of a feasibility study (successfully completed and submitted), acquisition of land for the project (concluded), due diligence of CHiNT and Intratrek (Done), authorisations by parties to the EPC to execute the project and production of an environmental impact certificate.
CHiNT Electric Co has built more than 4 000MW of solar farm energy across the world and is among leading global firms in installation of turnkey solar systems.
CHiNT was founded in 1994 by Nan Cunhui, who was part of Chinese businessman and members of the Chinese Communist Party that held meetings with a powerful delegation led by the President on his recent visit to China. He participated in the meetings in his capacity as mxember of the Chinese Communist Party.
The businessman is a member of the Chinese National People’s Congress and President of the Chinese Federation of the Industrial Economy.
Further, Mr Cunhui is also an executive member of the Chinese Federation of Industrial Economy who has received several awards for his business acumen.
The Chinese group said that it was committed to attract as much capital for the Gwanda solar project as possible from local and international infrastructure financiers, a commitment evidenced by its agreement to the reduction of the EPC price.
The Gwanda solar farm will be built in phases of 26,1MW, 28,2MW, 21,7MW and 23,9MW for maximum cost to benefit to ZPC.
Meanwhile, Intratrek Zimbabwe, CHiNT Electric’s local partner in the Gwanda project, is finalizing alternative funding for the project locally through pension funds and insurance backed infrastructure bonds.
Finance and Economic Planning Minister Patrick Chinamasa last year granted prescribed and liquid asset status to infrastructure bonds meant to raise part of the fund (equity contribution) for the solar project.
The bonds will be raised through Zimbabwe’s biggest bank by assets and revenue, CBZ Bank, a behemoth financial institution in which the State has significant stake. The State Procurement Board, now Procurement Regulatory Authority of Zimbabwe, approved the alternative funding arrangement. It (SPB) is also the one that awarded the project to the lowest bidder to specification.
Initiatives to address the energy deficit are in line with medium term policy, Zim-Asset targets, which aims for energy self-sufcficiency beyond 2018. Currently, Zimbabwe has an energy deficit of 600MW, but with the economy depressed, the deficit will widen as the economy recovers.
Source: iHarare with Addition Reporting from the Herald