Government last week Wednesday contracted CBZ Holdings, one of the country’s biggest financial institutions, to raise US$2 billion through bonds to fund infrastructure facilities at the country’s institutions of higher learning.
As lead financial advisors, CBZ Holdings is to raise the financial resources from both local and offshore investors within a year.
Permanent Secretary in the Ministry of Higher and Tertiary Education, Science and Technology Development, Machivenyika Mapuranga, said the funds will be deployed towards the construction of staff and student accommodation, lecture theatres, laboratories, workshops, administration blocks, student service centres, sporting and recreational facilities at state universities, teachers' colleges, polytechnics and industrial training colleges.
According to Mapuranga, Zimbabwe has 20 universities, 14 teachers' colleges, eight polytechnics and five industrial training centres with a combined student population of 152,529 and staff population of 18,153, requiring at least 562 student hostels and 10,836 staff houses.
To land the prized job, CBZ Holdings beat 11 other bidders including TN Financial Services, Cosmos Capital Ltd, EFE Services, Price Waterhouse Coopers, Met Bank Ltd, Brainworks Capital, ZB Capital, Genesis Global Finance, Intellego Investments and KPMG.
CBZ Holdings CEO Never Nyemudzo told media that the success of what has been called the Higher Education Infrastructure Bond relied upon government support and the security of the investment.
His bank stands to realise a commission of 1.5% of the amount raised.
The Higher Education Infrastructure Bond, together with the Road Rehabilitation Bond, is part of government initiatives announced recently to improve lacking or dilapidated state infrastructure, particularly university hostels and lecture halls, as well as the rehabilitation of the country’s ageing and pothole-afflicted roads network.
All stated-owned institutions of higher learning rely on government for most of their funding, and in the wake of dwindling support from the national purse, many are struggling to fund infrastructure developments from their own resources.
For the 2017 financial year, government allocated US$23.2 million to both kick-start new and to complete existing infrastructure projects at universities, a figure deemed inadequate by stakeholders.
With the government financially hamstrung to meet most of its financial obligations, analysts say institutions of higher learning must enter into strategic partnerships with the corporate world to raise additional resources to meet infrastructure needs.
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