Chivayo says Gairezi hydro project collapsed over bankability, not payments

BUSINESSMAN Wicknell Chivayo has said financial constraints, not corruption or personal benefit, caused the long-delayed 30-megawatt Gairezi hydro power project in Nyanga to stall, responding to criticism by Nyanga South legislator Supa Mandiwanzira.

In a detailed statement issued after Mandiwanzira pressed for urgent government intervention to revive the project, Chivayo said the tender was awarded to a consortium led by Indian state-owned engineering firm Bharat Heavy Electricals Limited and Angelique International, with Intratrek Zimbabwe acting as the local contractor.

“The fundamental issue that prevented implementation was challenges in achieving financial closure,” Chivayo said, adding that the project’s estimated US$113 million cost for 30MW made it difficult to meet lenders’ return and bankability requirements.

He said financiers were not satisfied with the project’s projected cash flows, plant load factor and repayment security, despite the technical feasibility of the hydro scheme.

Chivhayo also dismissed claims that payments were made despite the project’s failure to proceed, saying international power projects require strict pre-disbursement conditions, including guarantees, letters of credit, and technical milestones.

“Contractors also get disappointed when projects stall because we incur substantial upfront costs during bidding,” he said.

He said government and Zimbabwe Electricity Supply Authority later prioritised higher-yield projects, including Hwange Units 7 and 8, which added 600MW to the national grid, placing smaller hydro projects such as Gairezi on hold.

Mandiwanzira has warned that years of delay have deprived Nyanga of jobs, economic activity and reliable electricity, urging authorities to unlock funding for the Tangwena–Dazi power project.

Chivayo said he supports renewed consideration of the project under a more viable financing structure.