The deal will be one of the country’s biggest road projects since independence.
The highway is economically significant as it links landlocked Zimbabwe and Zambia to the Indian Ocean ports of Durban and Richards Bay.
The contract was agreed with closely held Geiger International of Austria and state-owned China Harbour Engineering Company (CHEC), Transport Minister Joram Gumbo told reporters in the capital, Harare, on Monday.
CHEC, a subsidiary of China Communications Construction, will team up with Geiger to upgrade and add more lanes to the 900km highway from Beitbridge on the border with SA to Chirundu on the Zambian border.
The companies would operate a 20-year concession for the stretch of road from Beitbridge on the southern border to Harare, while the renewal of the northern section to Chirundu would be funded with loans from the private sector, the minister said.
The highway has fallen into a state of disrepair as heavy-duty trucks use it to transport everything from maize to mining and power-plant equipment from SA to other parts of the continent.
CHEC joins several Chinese firms that have been given contracts in Zimbabwe, for projects such as building power stations or revamping water plants, since President Robert Mugabe’s government fell out with western financiers in 2000.
The road project is split in two phases, with the Chinese-Austrian venture building and getting a 20-year concession to operate part of the road, while the other part will be financed by a loan from an unnamed party and investment from CHEC.
The recent renewal of the Plumtree-Mutare road, which runs from Zimbabwe’s western border with Botswana to its eastern border with Mozambique, was completed by Group Five in 2015 at a cost of about $3bn.
Zimbabwe’s economy, suffering its worst crisis since 2008, has left the government unable to pay public servants’ wages on time, and has delayed payment to troops, with 83% of revenue collected going to salary payments.
The country missed its own deadline to repay $1.8bn to the IMF, the World Bank and African Development Bank by June 30.
BD Live