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‘BCC running scared over Egodini contract’

By George Vee Nyathi

Bulawayo city fathers are running scared of losing a legal battle and suffering financial damages that could visit the local authority in the event of cancelling the much-awaited US$60 million Egodini Mall tender, investigations have shown.

The Egodini Redevelopment project tender was awarded to Terracotta (Pvt) Ltd two years ago and the first phase was to be completed by March 2020 but minimal work has been done.

Officials at the troubled local authority have been toying around with the idea of cancelling the tender since 2018 after realising the project would not take off as expected due to a cocktail of challenges.

However, some officials at Bulawayo City Council (BCC) are scared to bite the bullet and cancel the tender.

Council records seen by CITE during investigations on the still-born project show  councillors had agreed there was a need to scrap off the tender since no “reasonable” movement in the project – the construction of the mall and transport hub had taken place

A council report dated April 1, 2020 revealed a majority of councillors were unhappy with the delays and most of them supported the idea of cancelling the tender and re-advertising.

“Alderman Siboniso Khumalo proposed that the contract between Council and Terracotta be cancelled as residents had started showing concerns since the project had failed to take off in time. When it finally took off there were a lot of excuses regarding the slow progress.”

The report listed several other councillors who supported the re-tendering of the project, with only a few reportedly against it.

“Councillor Donaldson Mabutho supported the termination of the contract to redevelop Egodini”, as the city was currently congested because of the incomplete works at Egodini. Councillor Sikhululekile Moyo concurred the project had taken too long and “there was a lot of disorder in the City especially with public transport and vendors.”

Councillor Lillian Mlilo indicated another tender should be advertised with Aldermen Ernest Rafomoyo and Norman Hlabano agreeing “the contract should be terminated.”

However Councillor Shadreck Sibanda did not support the contract termination, saying the programme of works should be extended and Councillor Tawanda Ruzive concurred, “Terracotta had invested a lot of money in the project, cancelling would negatively affect both parties.”

The details of the deliberations also supported calls by central government to cancel the tender and re-flight it.

Last year, Bulawayo Provincial Affairs and Devolution Minister, Judith Ncube, said the government was worried about the delays.

“We summoned the directors to my office to explain the delay, and in their explanation they said they were putting final touches before construction work can begin. However, we have not seen any movement yet and we have summoned them again. I was supposed to meet them last week, but because of the funeral wake [of Callistus Ndlovu] the meeting could not take place,”  she said at the time.

“We want to find out and understand what is stalling the whole project. If they have any problems, a solution has to be found; Bulawayo awaits that project.”

Investigations reveal BCC is afraid of being slapped with a lawsuit by Terracotta for reneging on their agreement and showed that while the contractor might have failed to meet its targets, the city could suffer immense financial losses.

“Terracotta is aware the agreement with council gives them the upper hand over BCC and would want to sue the council for as much as US$200 million to US$300 million for loss of business should the tender be cancelled,” said inside sources within BCC.

“Our city fathers believe a miracle might happen and the contractor will go back to work. It is unfortunate the contractor feels this is now too heavy for them but they don’t want to admit it. They want to keep council guessing.”

BCC, through its Corporate Communications Manager, Nesisa Mpofu, said as far as council was concerned, work on the mall was in progress.

“Work is in progress at Egodini as per the programme of the works,” she said, in a brief response.

On the council’s fears of an impending lawsuit, should the tender be cancelled in line with the demands of councillors and other stakeholders, Mpofu was non-committal.

“We are not aware of the above claims,” was all she could say.

In July last year, BCC Chamber Secretary, Sikhangele Zhou, revealed council’s shoddy approach to business had failed Terracotta in its plans.

Zhou said while the contractor had failed to meet certain contractual obligations, BCC was also to blame for failing to comply with some agreed aspects of the deal.

“Council was now in this situation where it could not cancel the contract even if it so wished and the reason being it had not fulfilled parts of the contract. There was need for council to register the Notarial deed and reason why this was not done is there were two privately owned properties within the area of development that council was unable to purchase because it had no funds even though negotiations to purchase were done,” she said while responding to councillors’ complaints over the matter.

Apart from the two properties mentioned, some negotiations were only finalised late in 2020, paving way for the council to issue a development permit for phase one of the mall’s construction.

Thulani Moyo, one of the Terracotta directors, said construction would not begin without council’s issuance of the permit, delays that fall squarely on BCC.

“We were held back by challenges faced by council. First, we had to await the council to finalise certain processes to do with the land on which the mall would sit. In terms of the law, council is supposed to consolidate stands in the area where the mall is intended to be constructed. The law does not allow us to construct across stands that have not been consolidated. That discussion took time and we had to end up intervening and paying off some of the costs because council had no money to foot those expenses,” Moyo said.

“After consolidating some of these stands, we discovered some issues were outstanding. We believe negotiations are on-going. It is important to note that the council only gave us the permit to develop the first phase towards the end of last year and with the Covid situation in the country, the government advised us to put our programme on hold.”

Bulawayo deputy mayor, Councillor Mlandu Ncube is on record saying council was still eager to give Terracotta another fighting chance.

“There is no vacancy in as far as the Egodini Mall issue is concerned. We have been advised by the contractor they are going back on site when the Covid-19 situation subsides. We will hold them to their word and await to see how far they go in the next few months when the return to site. There is no rush to talk about cancelling the tender,” Ncube said.

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