- Bitumen World is cutting jobs due to delayed government payments for major infrastructure projects undermining its growth and livelihoods of workers
- Since January 2025, platinum exporters, including have not received the 30% ZiG equivalent for their export earnings under the RBZ’s surrender rules
- Delayed payments to contractors and exporters have trapped funds in government accounts, creating an artificial shortage of the ZiG currency
Harare- Bitumen World, one of Zimbabwe’s largest construction contractors, has announced job cuts due to severe cash flow pressures stemming from delayed government payments.
In a statement, the company said, “This necessary transition reflects a committed effort to adapt to the current economic challenges, including operating under cash flow pressures caused by delayed payments from clients.”
These delays, which have also left platinum exporters unpaid for their 30% ZiG equivalent under government export surrender rules since January 2025, have triggered an artificial shortage of the Zimbabwe Gold (ZiG) currency, driving an artificial surge in its value and deepening economic distortions.
Founded in 2012 by chief executive Andre Zietsman, Bitumen World has grown rapidly, fuelled by government contracts for projects like the Harare–Masvingo highway and dam construction.
In 2019, Hamish Rudland became a shareholder, supporting the company’s expansion into an international unit, Inter-Africa Civils (IAC), and a mining venture, BW Mining.
However, delayed government payments have forced Bitumen World to cut costs, including staff, threatening the livelihoods of workers who, as Zietsman noted, “built this prestigious brand, a brand that was wholly created by Zimbabweans.”
The company did not specify the number of layoffs but emphasised its history of delivering projects on time and within budget, making the layoffs a tragic outcome of systemic failures.
Bitumen World is one of five local firms contracted for major state projects, a strategy championed by President Emmerson Mnangagwa in 2023 to build domestic capacity.
“In the past, when we wanted to build a road we would look for foreign tender. This time around, we said no, we settled on five domestic companies,” he said.
Yet, delayed payments have turned this vision into a liability.
Finance Minister Mthuli Ncube admitted in April 2025 that cash constraints have led to arrears, particularly in transport and infrastructure.
“We keep encouraging [contractors] to do more work while we settle those arrears,” he told Parliament.
Masimba Holdings, another contractor, saw its revenue fall 43% in Q1 2025 after pivoting to private sector clients to avoid government payment risks.
Unfulfilled promises, such as Bitumen World’s build-operate-and-transfer concession for the Beitbridge–Victoria Falls Highway, further erode trust.
The payment delays extend beyond contractors to Zimbabwe’s critical platinum sector, the world’s third-largest producer of platinum group metals (PGMs) after South Africa and Russia.
Since January 2025, platinum exporters, including Valterra Platinum, Impala Platinum’s Zimplats, and Mimosa (a joint venture between Impala and Sibanye Stillwater), have not received the ZiG equivalent for the 30% of their foreign currency earnings they are required to surrender to the Reserve Bank of Zimbabwe (RBZ) under export retention rules.
This policy, increased from 25% to 30% in February 2025, mandates exporters to convert 30% of their earnings into ZiG at the official interbank rate, which is often overvalued compared to the parallel market rate (ZiG27 per USD officially vs. ZiG36 per USD informally).
The mining chamber reports that platinum producers, who exported PGM mattes and concentrates worth $690 million in the first half of 2025, are owed millions in unpaid ZiG equivalents.
This non-payment exacerbates cash flow constraints, as exporters rely on foreign currency for vital imports and loan repayments.
It seems government’s thrust of balancing the books and keeping ZiG steady is simply not paying its obligations.
The overvalued ZiG conversion further erodes income, with a potential 8.8% revenue loss on a $100 million export due to the parallel market premium.
The failure to pay contractors and exporters has created an artificial shortage of ZiG, as funds remain trapped in government accounts. This liquidity crunch slows economic activity, as firms like Bitumen World and platinum exporters struggle to pay suppliers and workers.
The RBZ’s February 2025 Monetary Policy Statement, which increased the export surrender requirement to 30%, aimed to bolster ZiG liquidity and reserves, collecting $215 million from exporters in Q1 2025.
However, non-payment of the ZiG equivalent has backfired, reducing circulation and driving an artificial surge in the currency’s value on the parallel market.
By January 2025, the parallel market rate fluctuated between 35–40 ZiG per USD, compared to the official rate of 26.4 ZiG per USD, reflecting a significant premium.
This surge distorts the economy, making exports less competitive and imports cheaper, potentially widening Zimbabwe’s trade deficit, which stood at $158.5 million in June 2025.
Inflation, already at 14.6% year-on-year in January 2025, is exacerbated as businesses raise prices to offset cash flow losses.
The Horticulture Development Council has criticized the surrender policy as “unfair and counterproductive,” noting that USD-denominated costs for inputs like fuel and fertilizers leave exporters squeezed.
Broader Economic and Social Fallout
The government’s localization strategy, intended to reduce reliance on foreign firms, is faltering. Payment delays have stalled infrastructure projects and hurt exporters, undermining economic growth projected at 6% for 2025.
The social toll is significant, with layoffs at Bitumen World and financial strain on platinum exporters threatening jobs in key sectors. Unemployment, officially at 9% but likely higher due to the informal economy, risks rising further.
The ZiG’s volatility since its April 2024 launch, erodes trust and complicates financial planning for businesses and individuals.
Policy Recommendations
The government must urgently clear arrears to contractors and pay exporters their ZiG equivalents, potentially using treasury instruments or multilateral loans. Transparent payment schedules and a dedicated infrastructure fund could rebuild trust.
To address the ZiG shortage, the RBZ could increase liquidity through targeted interventions, such as expanding the US Dollar Denominated Deposit Facility (USDDDF), while avoiding inflationary risks.
Exporters could benefit from aligning local costs (e.g., utilities) with ZiG pricing, as suggested by the Horticulture Development Council, to reduce USD dependency.
Contractors like Bitumen World should diversify into private sector projects, though this risks undermining the government’s localization goals.
Therefore, the government’s failure to honour obligations threatens its infrastructure and export-driven growth strategy, eroding trust and livelihoods. Without swift action to clear arrears, stabilize liquidity, and reform retention policies, Zimbabwe risks further economic instability, with the very firms and workers it sought to empower bearing the brunt of systemic failures.
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