Local Government Minister July Moyo says the purported cancellation of the Pomona waste to energy project by the Jacob Mafume led City of Harare was improperly executed.
The controversial 30 year deal was entered into between the City of Harare and Netherlands registered company Geogenix BV which was awarded a €304 million (about US$320 million) contract to turn Harare’s waste into energy.
Speaking in Parliament yesterday Moyo said the Government undertook to pay amount owed to Geogenix BV by the City of Harare because they were the underwriter and wanted to protect the integrity of the country.
“When we have a Government guarantee over any entity in the country and if there is a potential default, Government Treasury is the one which undertakes to take over the payment and the Ministry of Finance and Economic Development is paying. When that deal was negotiated, chaired by Government with the Attorney General in attendance, we were aware that if this deal has to be cancelled, it has to be cancelled properly.
“When we discovered that it was not cancelled properly, we knew that we would be in default and therefore we have gone ahead to make sure that we protect the integrity of the country in terms of investments and in terms of doing a job which we know we have to do and that is why we are going ahead with that project,” said Moyo
He said added “…the Government of Zimbabwe together with the City of Harare, entered an agreement with Geogenix and the negotiated agreement was underwritten by the Government of Zimbabwe as a guarantor. So anything that would abrogate would be taken over by Government and Government has done so; it is paying so that Pomona can be fixed and it is being fixed.
“As Government, we want to appreciate the fact that this time the very environmental hazard that was happening at Pomona is being undertaken and for the first time, even the fires that started in October and would continue for two months were extinguished within 24 hours because of what is going on hence the Government is paying because it is enjoined to make sure that, that project does not default and Government takes the risk of that default.”