View
5
Download
0
Category
Preview:
Citation preview
ZAMBIA RAILWAYS LIMITED (ZRL)
Theme: Great by Choice
“ZRL- Guarantees Safety and Business Growth”
STRATEGIC PLAN For The Period 2018- 2022
1
Table of Contents
Table of Contents ............................................................................................................... 1
PREFACE .................................................................................. Error! Bookmark not defined.
Foreword ............................................................................................................................. 6
ABBREVIATIONS AND ACRONYMS ........................................................................... 8
Executive Summary .......................................................................................................... 10 THE STRATEGIC PLAN ................................................................................................... 10
CHAPTER 1 ...................................................................................................................... 13 1.1 Introduction ..................................................................................................................... 13 1.2 Institutional Review Framework .................................................................................... 14 1.3 Mandate of Zambia Railways Limited ........................................................................... 15 1.4 Governance of ZRL .......................................................................................................... 17 1.5 Management and Structure ............................................................................................. 18 1.6 ZRL Clients and Needs.................................................................................................... 18 1.6.1 Freight Service ............................................................................................................. 18 1.6.2 Passenger Service ........................................................................................................ 19
CHAPTER 2 ...................................................................................................................... 20 2 SITUATION ANALYSIS ................................................................................................ 20 2.1 Situation Analysis Framework ....................................................................................... 20 2.2 PESTELI Analysis ............................................................................................................ 20 2.3 SWOT Analysis................................................................................................................ 35 2.3.1 Internal Strengths and Weaknesses ........................................................................... 35 2.3.2 External Opportunities and Challenges ..................................................................... 36 2.3.3 Stakeholder Analysis .................................................................................................. 37 2.3.4 Strategic Engagement Plan ......................................................................................... 38 2.4 Strategic Issues ................................................................................................................. 39 2.5 ZRL Strategy Map ............................................................................................................ 41
CHAPTER 3 ...................................................................................................................... 42 3 STRATEGIC DIRECTION: VISION, VALUES AND MISSION ................................. 42 3.1 Our Vision ........................................................................................................................ 42 3.2 Our Values ....................................................................................................................... 42 3.3 Our Mission ..................................................................................................................... 43 3.4 Strategic Pillars and Key Result Areas (KRA) ............................................................... 43 3.5 PILLAR 1: Financial Stewardship and Viability ........................................................... 43 3.6 PILLAR 2: Customer Satisfaction ................................................................................... 44 3.7 PILLAR 3: Operational Excellence .................................................................................. 45 3.8 PILLAR 4: Strong Brand and Partnerships ..................................................................... 47 3.9 PILLAR 5: Human Capital and Capacity ........................................................................ 48
CHAPTER 4 ...................................................................................................................... 54 4 GOVERNANCE, INSTITUTIONAL FRAMEWORK FOR IMPLEMENTATION ...... 54 4.1 Governance ...................................................................................................................... 54 4.2 Institutional Arrangements ............................................................................................. 54
2
4.3 ZRL Performance Reporting Flowchart .......................................................................... 55 4.4 Resource Mobilization, Financial Management and Procurement ............................... 55 4.5 Investment Estimates for 2018 – 2022.............................................................................. 56
CHAPTER 5 ...................................................................................................................... 57 5 PERFORMANCE MONITORING ................................................................................. 57 5.1 Introduction ..................................................................................................................... 57 5.2 Corporate Goals and Performance Metrics .................................................................... 58 5.3 Factors That Could Affect Goal Achievement ............................................................... 58
CHAPTER 6 ...................................................................................................................... 61 7 ANNEXES ........................................................................................................................ 65 7.1 Annex 1: PROJECTED YEAR ON YEAR KEY RESULTS FOR THE PLAN PERIOD . 66 7.2 Annex 2: Organization Chart .......................................................................................... 67 7.3 Annex 3: Comprehensive Profit and Loss Statement .................................................... 68 7.4 Annex 4: Cash Flow Statement ....................................................................................... 69 7.5 Annex 4: Statement of Financial Position ...................................................................... 70
3
LIST OF FIGURES
Figure 1: Summary Balance Scorecard and Strategic Pillars .................................... 12
Figure 2.1: Linkages to the Sea Ports ........................................................................... 16
Figure 3.1 Stakeholder Map .......................................................................................... 37
Figure 2. 1: Strategy Map ............................................................................................... 41
Figure 2. 2 Summary Balance Scorecard and Strategic Pillars ................................. 43
Figure 4. 1: Performance Reporting Flowchart .......................................................... 55
Figure 4. 2 Investment Cost 2018 - 2022 ...................................................................... 56
4
CHAIRMAN’S STATEMENT
This strategic plan is the new roadmap that ZRL will follow
to realize its vision of being the preferred regional rail
transport and logistics provider. The plan covers the period
from 2018 - 2022. I am greatly honoured to present this Plan
and also acknowledge the hard work and commitment of
our Management and staff, led by the Chief Executive
Officer in its preparation. This strategic plan articulates the
vision, mission, core values and the results of the ZRL. The
plan has outlined the objectives, strategies, targets to be achieved with the key
performance indicators to help measure the progress being made.
The Zambia Railways Strategic Plan (ZRSP) has been prepared through a consultative
process and has taken into account the need to harmonize ongoing reforms in the
transport sector, at the heart of this is draft National Transport Policy and the National
Transport Master Plan (NTMP). In preparing the strategic plan, the country‘s vision
2030, the Seventh National Development Plan (7NDP), Ministry of Transport as well as
the Industrial Development Corporation (IDC) strategies have been taken into account.
This strategic which plan builds and consolidates the gains from the previous plans
broadly aims at re-energizing ZRL towards improved service delivery, operational
efficiencies, strategic partnerships and brand awareness and becoming more financially
and commercially viable. This will be realized through five strategic pillars;
1. Financial Stewardship and Viability,
2. Customer Satisfaction,
3. Operational Excellence,
4. Strong Brand and Partnerships and
5. Human Capital.
5
From the Board perspective, the thrust of ZRL next five years is to ensure sustainable
business practices that result in customer satisfaction and create value for the
shareholders. This requires a paradigm shift and mind set change among the ZRL staff
as well as ethical behavior, performance and accountability. It is my sincere hope that
ZRL staff and stakeholders will participate fully in this strategy execution to ensure the
realization of our vision.
Mr. Lubinda Linyama BOARD CHAIRPERSON
6
Foreword by the Managing Director
This Strategic Plan provides a framework for ZRL action
during the next five years. Our theme is ―Great by
Choice‖ and reflects our commitment to awaken the giant
and continue to thrive as the preferred regional rail
transport and logistics provider. We have identified five
strategic goals and outcomes to be accomplished from
2018 through 2022. In the plan is reflected the guidance
provided by stakeholders during various workshops and
engagements. We have also built on ZRL‘s remarkable
success over the past decade.
In the next five years we have are focused to deliver customer satisfaction and
shareholder value by delivering the following key result areas;
i. Financial strength and sustainability;
ii. Safe and reliable delivery of quality service to customers and stakeholders;
iii. Competitive and reputable brand with strong strategic partnerships in the region
and internationally;
iv. Organizational strength and operational effectiveness, and;
v. Committed, competent and high performing workforce.
In the execution of this plan, we will demonstrate unwavering commitment to our core
values; teamwork, integrity, innovation, professionalism and service.
ZRL strategic plan is divided in five chapters;
Chapter one is the introductory part of the plan whereby the background of ZRL,
institutional review framework, mandate of ZRL, management and core functions and
client‘s needs are discussed. Chapter two speaks about the overall situation analysis
which is the thrust for the formulation of the strategic plan. Chapter three ends with the
cluster and analysis of the strategic issues and presentation of the strategy map
7
highlighting four balance scorecard perspectives: financial, customer/stakeholder,
internal business process and organizational capacity.
Chapter three shares the vision, mission and values together with key result areas and
the strategic objectives of this plan. Chapter four is about how the plan will be
implemented; this chapter concentrates much on governance, institutional framework
and over all implementation arrangement. The last chapter is on how the performance
of the plan will be monitored.
In conclusion, we are involved in more demanding, complex, and interdependent work
with rapidly changing business models, processes, and technology. We need a thorough
understanding of the business value, cost, and impact on operational efficiency of new
requirements, investments, or Initiatives. The ZRL Strategic Plan 2018-22 will ensure we
make the needed investments and develop the initiatives to maximize our ability to
achieve our important mission.
Mr. Christopher C Musonda
CHIEF EXECUTIVE OFFICER
8
ABBREVIATIONS AND ACRONYMS AG Attorney General
BBR Beit Bridge Bulawayo Railways
BoP Balance of Payments
BOZ Bank of Zambia
BR Botswana Railways
BSC Balanced Scare Card
Capex Capital Expenditure
COMESA Common Market for Eastern and Southern Africa
CDN Corredor De Densenvolvimento Do Norte, SA
CEAR Central East African Railways
CEO Chief Executive Officer
EAC East Africa Community
GAIN Notre Dame University Global Adaptation Index
GDP Gross Domestics Product
GRZ Government of the Republic of Zambia
HIV-AIDS Human Immunodeficiency Virus- Acquired Immunodeficiency
Syndrome
ICT Information and Communication Technology
IDC Industrial Development Corporation
IFMIS Integrated Financial Management Information System
KPI Key Performance Indicator
KRA Key Results Area
MP Member of Parliament
MoF Ministry of Finance
MoTC Ministry of Transport and Communications
MTEF Medium Term Expenditure Framework
NEAP National Environmental Action Plan
9
NGO Non-Governmental Organisation
NRZ National Railways of Zimbabwe
NTMP National Transport Master Plan
PESTEL Political, Economic, Social, Technological, Environment (Physical)
and Legal
PPP Public Private Partnerships
NRDA National Railways Development Agency
RWUZ Railway Workers Union of Zambia
SoE State Owned Enterprise
SO Strategic Objective
SWOC Strengths, Weaknesses, Opportunities and Challenges
SWOT Strengths, Weaknesses, Opportunities and Threats
SADC Southern Africa Development Community
SARA Southern Africa Railways Associations
SI Statutory Instrument
SNCC La Société Nationale des Chemins de Fer du Congo Sarl
TAZARA Tanzania Zambia Railway Authority
TFR Transnet Freight Rail
TSR Temporal Speed Restriction
TWS Train Warrant System
UNFCC United Nations Framework Conversion on Climate
ZEMA Zambia Environmental Management Agency
ZDA Zambia Development Agency
ZFS Zambia Furnace Supplies
ZRA Zambia Revenue Authority
ZRL Zambia Railways Limited
ZRLSP Zambia Railways Limited Strategic Plan
7NDP Seventh National Development Plan
10
Executive Summary
THE STRATEGIC PLAN
The strategic plan period is January 2018 - December 2022. However, the plan will be
implemented on a rolling basis and therefore emergent strategy, new and unforeseen
environmental threats will be accommodated through annual and midterm reviews.
The plan provides for a monitoring framework through the tracking of key indicators.
Zambia Railways Vision
To be the preferred regional rail transport and logistics provider.
Our Values
Team Work: WE value teamwork. We believe team work will sustain efficiency and
effective service delivery. We recognize the contribution and value of individuals in a
team.
Integrity: WE will do what we say we will do. We will up-hold professional and ethical
business practices. The company's interactions with stakeholders will be done
transparently for mutual benefits. We will ensure honesty, integrity and respect to all.
Innovation: WE are creative, bold and believe in continuous learning. We believe these
will sustain total quality consciousness in the organization.
Professionalism: WE uphold high quality standards and ethics in our dealings to
enhance professional competence by providing the highest level of service.
Service: WE believe in delivering excellent service and value to customers. We take time
to understand customers‘ needs and always strive to surpass customers‘ expectations.
Our Mission
To provide sustainable and competitive rail transport and logistics solutions to
customers and deliver shareholder value.
11
Strategic Pillars and Key Result Areas (KRAs)
From the strategic issues, the following will be the plan‘s Strategic pillars and key result
areas in the balance score card perspectives. These will be the areas of impact for the
plan period.
STRATEGIC PILLAR 1: Financial Stewardship and Viability
KRA 1: Financial Strength and Sustainability
Strategic Objective 1.1: Increase Profitability
Strategic Objective 1.2: Optimize Resources
Strategic Objective 1.3: Improve Liquidity
Strategic Objective 1.4: Reduced Exposure to Enterprise Risks
STRATEGIC PILLAR 2: Customer Satisfaction
KRA 2: Safe and Reliable Delivery of Quality Service to Customers and Stakeholders
Strategic Objective 2.1: Improve tonnage traffic
Strategic Objective 2.2: Increase market share
Strategic Objective 2.3: Improve reliability and availability of the rolling stock fleet
Strategic Objective 2.4: Improve Customer Satisfaction
Strategic Objective 2. 5: Strong Stakeholder engagement
STRATEGIC PILLAR 3: Operational Excellence
KRA 3: Organizational Strength and Operational Effectiveness
Strategic Objective 3.1: Efficient and effective business processes
Strategic Objective 3.2: Improve train operations efficiency
Strategic Objective 3.3: Reduce derailments and accidents
Strategic Objective 3.4: Improve Infrastructure
Strategic Objective 3.5: Improved ICT infrastructure
STRATEGIC PILLAR 4: Strong Brand and Partnerships
KRA 4: Competitive and Reputable Brand with Strong Strategic Partnerships in the
Region and Internationally
Strategic Objective 4.1: Enhanced Corporate Reputation
Strategic Objective 4.2: Increase strategic partnerships
12
Strategic Objective 4.3: Settlement of all cases for and against ZRL
STRATEGIC PILLAR 5: Human Capital and Capacity
KRA 5: Committed, Competent and High Performing Workforce
Strategic Objective 5.1: Improve Recruitment and Retention
Strategic Objective 5.2: Improve staff productivity
Strategic Objective 5.3: “Learning organization” culture nurtured and strengthened
The plan is summarized in the figure below, demonstrating how the pillars link with
strategic elements and the four perspectives of financial, customer and stakeholder,
internal business process and organizational capacity.
Figure 1: Summary Balance Scorecard and Strategic Pillars
To assist in tracking the progress during the implementation of the Strategic Plan, an
implementation matrix has been developed. It details the specific objectives, strategies,
activities, Service Delivery Target (SDTs) and Key Performance Indicator (KPIs).
13
CHAPTER 1
1.1 Introduction The Zambia Railways Limited Strategic Plan (ZRLBP) outlines the strategic focus
during the next five years. This strategic plan has been developed by Zambia Railways
Limited (ZRL) in order to effectively undertake the mandate of ZRL and provide a
disciplined approach to the management of the company over the next five-year
horizon covering the period 2018 to 2022. This plan has been crafted after a period of
tremendous transformation in the operations of ZRL. The success and achievements of
the past also present future challenges. This perspective has been analysed and
addressed. It is on the basis of this performance that creates a need a road map for the
next five years. The plan seeks to provide a strategic framework for effective
organization, coordination and management of rail passenger and freight trains for five
years ending in 2022.
The plan begins with the review of the operating environment. This is meant to provide
a context, both historical and current realities, that will impact on the plan
implementation and provide a basis for the strategic options and choice. The seventh
national development plan is brought to attention as a reference point. The current
roles, functions, vision and mission of ZRL are restated. Against this background,
stakeholder and customer expectations have been analyzed to bring on board their
perspective. A SWOT analysis has been carried out to reflect both organizational and
institutional issues that need to be considered when crafting the strategies. Parallel to
this process, all critical and priority issues of strategic significance to ZRL have been
distilled and listed.
A new vision for ZRL has been agreed upon. This will be ZRL‘s new destination and
dream for the future. Supporting values have also been developed to guide ZRL
behaviour. To help us realize our dream is a new mission statement with an output
orientation.
14
ZRL is entering a new growth phase, this therefore calls for management focus and
hence the need for this strategic plan. The plan will serve as a road map to measure our
successes and a fund-raising tool. The strategy will be reviewed on annual basis to
bring it in line with emerging challenges. Using this strategic plan ZRL will position its
self to be the preferred rail transport and logistics provider in the region.
In their very nature, strategic plans are directional in terms of thrust while
implementation details are elaborated in the annual action plans and budgets. This
plan therefore provides the high level view of the ZRL‘s work program in the next five
years. Stakeholders are important strategic partners in the implementation of this plan.
Consultations have been done during the preparation of the plan to get stakeholder buy
in and inputs on how ZRL can become more effective and efficient. The plan provides:
(a) review of institutional and policy environment (b) situation analysis including both
micro and macro environmental factors likely to positively or negatively impact on the
plan; (b) an analysis of the critical issues with a bearing on the plan (c) the ZRLBP
strategic direction: vision, values, mission and Key Result Areas, (d) the governance
and institutional framework for implementation and (e) performance monitoring.
The plan therefore reflects the strategic thinking of the board, management, staff and
stakeholders of ZRL. The ZRL Management owns the plan and will work with other
stakeholders to ensure the plan has wide ownership and is implemented. The ZRLBP
attests to the Board‘s commitment to provide leadership towards the provision of
sustainable and competitive rail transport and logistics solutions to customers and
deliver shareholder value.
1.2 Institutional Review Framework The elaboration of the ZRLSP is premised on the understanding that ZRL is the entity
being planned for. The ZRLSP has been prepared to act as a road map for conducting
business within the rail transport sector in Zambia and the region. The plan has been
developed taking into account the need to harmonize the National Transport Policy, the
15
current Seventh National Development Plan, the Country‘s vision 2030 as well as the
Zambia National Transportation Master Plan. It has taken into account the outputs of
various workshops and meetings were held prior to the development of the plan.
The strategic planning process involved a team of external consultants who facilitated
data collection and discussion of the plan. ZRL Management, staff and stakeholders
were involved in structured interviews and workshops to provide inputs into the
process.
1.3 Mandate of Zambia Railways Limited ZRL is wholly owned by the Government of the Republic of Zambia through the
Industrial Development Corporation (IDC). The company is mandated under the
Railways Act to operate both rail passenger and freight trains. It was incorporated in
1982. The company has gone through different business cycles and restructuring. Up
until 2003, the company was a parastatal but privatized through concessioning to a
private entity called ―Railway Systems of Zambia‖. However, in September 2012, the
government rescinded its decision and repossessed Zambia Railways Limited from the
private entity due to the general deterioration of the rail infrastructure.
The company operates a total track length of 1,248km long single line of 1,067mm gauge
made up of the following track segments:
a) Mainline from Victoria Falls Bridge to Kitwe (848 km);
b) Branch Lines (214 km);
c) The Mulobezi Line (162 km); and
d) The Chipata- Mchinji Line (24 km).
16
In the sub-region, ZRL is linked to almost all the ports in Southern Africa as shown in
the figure below.
Currently ZRL
employs around 950
employees with offices
dotted throughout the
rail network.
At present, ZRL owns
40 locomotives
(including 1 steam
locomotive) out of
which 20 locomotives
are operational leaving a total of 20 locomotives which are defective and extensively
cannibalised. In terms of wagons and carriages, the company owns a fleet of 2,094
wagons of various types out of which 1,200 are operational and 60 passenger coaches
(out of which 40 are operational).
The main workshops for heavy repairs, rehabilitation and maintenance of the rolling
stock are concentrated in Kabwe. Further, the company also has repair depots for its
rolling stock in Livingstone, Ndola and Kitwe.
Until the 1990‘s, ZRL was the main carrier of the bulk cargo and long distance
passengers. Today, trucks are the dominant transport mode. The resulting damage to
Zambia‘s roads and concerns over congestion, safety and environmental damage have
led to widespread calls for the Government to act and reverse the switch from rail to
road.
Figure 2.1: Linkages to the Sea Ports
17
1.4 Governance of ZRL In terms of governance, ZRL is governed by the Railways Act, Cap 453 of the Laws of
Zambia, and is incorporated under the Companies Act, Cap 388 of the Laws of Zambia.
Furthermore, the Company is also governed by its Articles of Association and has to
comply with its provisions at all material times. Article 78 of the ZRL Articles of
Association provides that the composition of the Board Members shall at all times be
not less than five and not more than fifteen.
The Board provides strategic and tactical input to the ZRL senior management, in
determining the scope and relevance of ZRL‘s mandate, vision as well as its mission.
The company has developed and is implementing a board charter. The roles of the
Board and Management are distinct to avoid duplication. The Board is responsible to
the shareholder; Industrial Development Corporation (IDC) and policy maker; through
the Ministry of Transport and Communications (MoTC) for:
a) Firm value creation and payment of dividends;
b) Setting of strategic direction(s), monitoring of operational performance and
management processors and policies and compliance levels;
c) Integrity and quality of communication with stakeholders;
d) Appointing and disappointing ZRL Managing Director/Chief Executive Officer.
The Board is assisted in its functions by Board Committees and these are namely:
i. Finance and Administration Committee
ii. Technical Committee
iii. Audit and Risk Committee
The ZRL board has at its disposal a number of advisors that include; Ministry of
Transport, Attorney General, Ministry of Finance, Secretary to the Cabinet, Industrial
Development Corporation, Zambia Development Agency, Patents and Companies
18
Registration Agency, Bank of Zambia, Institute of Directors and other government
agencies.
1.5 Management and Structure ZRL is led by the Chief Executive Officer who is appointed by and reports to the Board
of Directors with the latter being appointed by the IDC. The Ministry of Transport and
Communications appoints the Government Inspector of Railways (GIR) to oversee the
conformity of the operations of the railway sector according to the Railway Act. ZRL
reorganized the previous nine (9) directorates into (6) six to assist the CEO in the day to
day management namely;
i. Directorate of Finance
ii. Directorate of Legal Services (Company Secretary)
iii. Directorate of Operations
iv. Directorate of Technical Services
v. Directorate of Human Resources and Admin
vi. Directorate of Marketing
1.6 ZRL Clients and Needs Traditionally, ZRL has provided two transport services to its clients. These are freight
and passenger services.
1.6.1 Freight Service Block Train Service
This is designed for customers with large quantities of cargo to a single
destination.
System Trains
This service is for customers with single or multiple wagon loads traversing
over ZRL. These trains link the Southern and Northern Districts and also
19
convey transit traffic between Southern Africa and Congo DR. A similar
service links the North and TAZARA and the port of Dar-e-Salaam.
Pick Up Trains
This is designed to serve farmers and other customers situated at wayside
stations.
1.6.2 Passenger Service Currently ZRL operates two (2) passenger trains on the mainline between
Livingstone and Kitwe, Mulobezi and Livinstone (mixed train) and the Lusaka
Commuter Train between Ngwerere and Lilayi (once a week); and
Currently provides long distance passenger services to an average 200,000 people
per year.
20
CHAPTER 2
2 SITUATION ANALYSIS
2.1 Situation Analysis Framework The situation analysis has been done at two levels using PESTELI AND SWOT tools.
The macro environment has been analysed on three levels: global, regional and
national/local level. The analysis take account of the major Political, Economic, Social,
Technological, Environment, Legal and Industry analysis (PESTELI) development that
have taken place that are likely to impact ZRL‘s operations either positively or
negatively. Further, ZRL‘s Strength and Weakness as well as Opportunities and Threats
(SWOT) have been identified.
2.2 PESTELI Analysis The analysis using this tool shows a very fragile and uncertain international
environment for the next five years of the plan implementation. This is characterized by
both global politics and unpredictable economic environment. Global geopolitics are
likely to keep shifting, with greater integration of regions and realignment of countries
as they seek new sources of competitive advantage and greater integration in the global
economy. The politics-trade divide will narrow as countries move forward towards
convergence. US-China-India relations will be central in defining the new order in
global scene, and the US-Russia-China relations are likely to be redefined. This will
impact on transport and supply chain systems as new international trade disputes and
contract enforcement will call for new skills.
The World economy is expected to register low growth as developed economies
dynamics keep shifting. World growth is expected to rise from 3.1 percent in 2016 to 3.5
percent in 2017 and 3.6 percent in 2018. In Europe and the US, heightened political
activity and marshalling of massive resources towards fighting terrorism and
addressing other volatile areas will take a centre stage. In the East, China and other
emerging economies will continue to consolidate their positions in global economic
21
arena. In Africa, attention will mainly be concentrated on realigning resources to focus
on key pressing issues such as health, education and infrastructure. The Sub-Saharan
economies will continue to grow at a rate that is likely to be higher than the world
average. The situation will impact on funding levels to the transport sector.
From a social and demographic front, developed economies will continue to have a
population age deficit with more elderly people coming into the scene. Africa will carry
on with a demographic and age dividend where a more youthful population which is
well educated join the employment ranks. This trend, while positive, may also create
higher unemployment levels and increase pressure on ZRL to employment more
people.
There are technological developments that will have a positive impact on management
of the world economies. New technologies in the mobile communications and
technology that is aimed at improving the delivery of commodities across many parts in
the world will receive more attention than before. E-supply chains systems will move
from nascent stage to more innovative systems of delivery of the entire logistics
solutions to the customers across continents.
The legal environment will be dominated by more dynamic laws which will demand
greater efficiency among institutions, increased accountability and prudence in the use
of public resources. In the case of African countries, the need for a new constitutional
order will grow. The new order is likely to lead to strict compliances by business.
The Industry environment is experiencing widespread change, driven by wide-ranging
and varied influences. With such a variety of changes comes both opportunities and
challenges. The following 9 key trends have been considered in shaping the ZRL 2018 –
2022 strategic plan.
22
1. Climate Change
The current rail networks world-wide were designed and build using
historical records of climate and weather events. Now the ―inconvenient
truth ―of climate change makes these designs unreliable as basis for future
green field designs. Even small shifts in temperature and weather patterns
can cause rail tracks to expand and buckle, and may lead to more regular
repairs, speed restrictions, delays and disruptions. Storms can damage or
deposit debris on lines and at stations and floods or high-tides can
submerge them as well.
Therefore, the new green-field projects and refurbishments must be based
on plan with a different weather future, and built accordingly with a
‗predict and prevent‘ ethos looking forward rather than back. The ZRL
network as it plans to integrate the region must be built with the future in
mind rather than using templates of old which are no longer viable.
2. Urban growth
According to United Nations figures, 54% of the world‘s population lives
in urban areas. This population is projected to reach 66% by 2050. Zambia
is the most urbanised country in the region with circa 60% of the
population already living in the urban areas. There is a heavy
concentration of communities along the line of rail and this has led to
encroachments with some people occupying railway reserve land, leading
to vandalism of ZRL infrastructure.
Again the United Nations projects that urbanisation combined with
overall growth of the world‘s population could another 2.5 billion people
to urban populations by 2050, with circa 90% of the increase concentrated
in Asia and Africa.
The infrastructure therefore needs to be designed to absorb the inevitable
growth and be as efficient and as rapid as possible. Along with the
increased pressure comes increased opportunities such as a widening tax
23
base that enables greater investment in public transport. An example
being the Crossrail project currently underway in London.
3. Rise of the start-ups
The entry into the industry of small, lean start-ups without the baggage of
legacy of obsolete equipment and systems presents a challenge for
traditional railways as well as an opportunity for PPP‘s for firms like ZRL
that are seeking to reinvent themselves into regional power houses of
logistic solutions.
These potential new competitors or partners don‘t play the conventional
rules of the business. Digital rather than physical solutions can be rolled
out in days or weeks, not months or years. And the perennial issues of
ticketing, overcrowding and train organisation are some of the issues in
the sights of start-ups.
4. Digitisation takes over
The internet of things (IoT) is enabling on-board sensors to deliver real
time analysis and monitoring, identify problems before they cause delays,
facilitate automated and preventative maintenance and ensure dispatchers
have an entirely accurate view of the train‘s location.
5. New players offering integrated travel and logistic solutions
There is a huge potential for rail, metro and truckers to provide travel
and logistic solutions. There are some who view the likes of Uber and Lyft
as the solution to the first-mile/last-mile challenge. Caution must also be
maintained that they don‘t become more attractive than railway transport.
And the performance of ZRL, particularly in payments and booking must
be improved to head off any such future threat.
6. Powered by difference energy sources
Globally there is increasing research to find possible replacements of
diesel for cleaner and greener energy. Options available include hydrogen
24
and perhaps the most appealing, LNG, already being tested by some
railways and offering a competitive price and lower carbon emissions plus
an established regulatory structure when compared to its fossil and
renewable fuel rivals. Stations can be powered by solar.
7. The station becoming a destination
Rail stations are changing from being designed as an afterthought for
many city planners to places to stay and enjoy, an amenity in itself, rather
than a building to quickly head away from or arrive with little time to
spare before catching a train.
8. Long distance travel makes a return
A number of factors such as improvements to booking and ticketing
allied with high-speed trains and on-board service are widening the
uptake for trains to travel across the region.
Another trend helping support long distance rail travel, is the growth of
code sharing, long found in the aviation industry where a marketing
arrangement is created with an airline placing its designator code on a
flight operated by another airline and selling tickets for that flight in order
to strengthen or expand their market presence and competitive ability.
This is now being seen in an intermodal form in partnerships with the rail
industry. This kind of link-up between airlines and rail lines, known
formally as air-rail alliance or informally ―Rail & Fly‖ are increasingly
popular. They will form a major part of ZRL becoming the rail and logistic
solution provider of choice in the region.
9. High-speed and Hyper-speed rail
Whilst the hyperloop may currently lack the financial or political will to
make it a reality there is no doubt that super high-speed rail is a reality.
A more enlightened and educated citizenry will crave for more rights. This means that
the ZRL will be faced with enlightened customers demanding value for money.
25
26
Table 2.1 that follows is a detailed analysis of the all the dimensions of PESTELI at global, regional and national/local levels. Table 2. 1 PESTEL Analysis
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
Political Environment
At the global level, the election of President Donald Trump in USA has implications of American Policy on Africa potential impact of financial assistance to Zambia. The War on Terror, which for the past 11 years has cost an estimated US $ 11.5 trillion is a huge opportunity cost element that could affect
Establishment of the SADC Protocol on Transport, Communication and Meteorology with the region and the Southern African Railway Association (SARA). Implications: Member country including Zambia shall promote the establishment of cross boarder multimodal Corridor planning committee.
There is a stable political environment in Zambia. The political goodwill that has been cultivated in the past is expected to continue over the plan period.
At National level, continued Government support, strong political will to improving transport infrastructure: Implications
The political stability that Zambia has enjoyed since independence has created a conducive and stable business environment. This has further led to increased investment and international reputation and good will. In this regard, ZRL can exploit the good will position itself as a premier business provider of sustainable and competitive rail
As a State-Owned Enterprise (SoE) through IDC, ZRL will be impacted by government policy either directly or indirectly. Government policy through the ministry of Transport may affect directly ZRL and be contrary to the set objectives. ZRL must put in place systems that ensure that both the shareholder (IDC) and policy makers (MoTC) provide a favourable business operating
27
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
funding priorities and global trade.
SARA is part of the SADC protocol on transport. It is a lobbying group for railway corridors linking ports in the region particularly with ZRL.
To transform the railway sub sector to an efficient, reliable, safe, and competitive transport mode with appropriate interfaces with the other modes of transport.
transport and logistics solutions to customers and deliver shareholder value
environment. These may include creating engagement platform for all stakeholders to be abreast with happenings in ZRL. Over reliance on government support will affect capacity of ZRL to finance operations and Capex
Economic Environment
At the global level, the price of copper has been up swing while the price of oil commodity has dropped. Implications: The export of copper will
At the regional level, Regional Economic integration gaining momentum, SADC, COMESA and EAC: Implications: closer cooperation
Export-driven growth will be supported this year by higher copper prices and demand. Tight credit conditions are expected to continue weighing negatively on
From 2015, there has been positive growth in the construction, transport and communication. The manufacturing sectors of the economy is expected to
The country‘s external debt stood at US$6.7bn in Sept 2016 with an overall Balance of Payment (BoP) deficit of US$432.3 m in 2015. The reserves accumulation stood at US$2.3bn during the same period.
28
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
increase the forex while importation of fuel will result in forex exchange. General economic meltdown: Has also changed the foreign policies for most developed countries, with more focus on revitalising their domestic economies at the expense of foreign aid
in all aspects including movement of commodity. Another implication of greater economic regional integration is the possibility of joint action on regional logistics system. Regional integration has made Cross border trade to increase and this tends to increase tracking and travel away from home. This more business opportunity for ZRL.
domestic economic activity. We expect economic growth of 4.0% in 2017, which is unchanged from last month‘s forecast, and 4.6% in 2018. The Zambian economy has grown steadily in terms of Gross Domestic Product (GDP) since 2000 with an averages rate of 5%. This growth was accompanied by improving macroeconomic fundamentals such as inflations to a single digit, a relatively stable
record improved growth of 3.4% in 2017 owing to improved agriculture production for the 2017/2018 farming season, rebounding of the copper prices and stabilization of power supply situation. Government has been focusing on infrastructure development in in rail, air and road. In rail sector, cargo transported by rail reduced by 10.9% from 973, 427 Mt in 2015 from 1,092, 341 Mt in 2014. This is attributed to lack
The copper production recorded a marginal increase of 0.3% due to unfavourable metal prices where copper earnings dropped by 31.3% from the 2014 levels. Serious external risk remain specifically those linked to the country‘s dependence on Copper mining. Despite a challenging picture between 2014 to 2016, Zambia‘s economic prospects remain positives with GDP growth expected to continue above the global GDP growth rates. The economic environment is
29
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
exchange rate and a general long term decline in interest rates.
of reliable and adequate rolling stock, poor state of rail track and competition from road haulage companies. The sustained bumper harvest in agriculture and the rebounding of the copper prices creates a opportunity for ZRL in terms of commodity movement.
therefore conductive for ZRL strategic goals.
Social Environment
Global Travel and connectivity brings up other challenges such as HIV and AIDS a global problem. There is more travel and
Regional trade results into exchange of skills, expertise and strengths to an organization. There is, therefore, need to leverage
Unemployment is mainly an urban youth issue with urban unemployment estimated at 15.3%. As a SoE, the job creation
There is a heavy concentration of communities along the line of rail and this has led to encroachments with some people
There is a heavy concentration of communities along the line of rail and this has led to encroachments with some people occupying railway
30
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
interaction through tourism which impact on the cross-boarder business. Globalisation has brought about cultural influences that have an impact on work ethics and productivity.
and unlock value from the interaction with regional player. One of a topical regional issue is gender. Throughout this plan, we must view gender diversity is a virtue.
agenda must be firmly factored into overall strategy.
occupying railway reserve land, leading to vandalism of ZRL infrastructure. Trained and well qualified staff is available and there is abundant labour. The HIV epidemic remains a threat to this abundant labour.
reserve land, leading to vandalism of ZRL infrastructure. Trained and well qualified staff is available and there is abundant labour. The HIV epidemic remains a threat to this abundant labour.
Technological Environment Factors
Global trends have brought in new technologies. This has quickened the pace of research and development. Global trends have brought in new ICT communication systems changing
At regional level, Technology is being shared by countries and facilitating integration as well as access to information. The transportation and logistics industry has
Zambia‘s Vision for Information Communication Technology (ICT) is ―A Zambia transformed into information and knowledge based society supported by increased access to ICTs by all
With transport and logistics being at the heart of ZRL, developing new technology to improve processes is even more important with the way long distance
Zambia is not technologically advanced. However, globalization has meant that advances in technology elsewhere have an impact on the environment in Zambia
31
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
the way we communicate and manage transport and supply chain systems.
Development of Telemedicine and e-medicine
traditionally been defined by trucks and infrastructure, but over the past several years technology has begun to change that.
citizens by 2030”. Achieving this vision, the Government identified the need to establish an ICT Center of Excellence as key in the realization of its vision. Advancements in the size and popularity of the e-commerce industry (such as cellular technology, fibre optic, e-government, mobile money, e-vouchers etc.) means that the pressures and importance of the supply chain
passengers and cargo are picked, packed, tracked and shipped all being made much quicker by using digital technology to speed up the process. The advancement in technology is poised to contribute to faster service delivery, increased market access and reduced cost of doing business. ZRL will play a role in this ICT expansion and will customise its services to be ICT relevant.
The transportation and logistics industry has traditionally been defined by trucks and infrastructure, but over the past several years technology has begun to change that. ZRL will need to keep in pace with all these changes to realise the strategic objectives set in this plan.
32
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
working correctly for ZRL is more crucial than ever to determine its success.
Environment Factors
Zambia is a signatory to the Paris climate
accord which is an agreement within the United Nations Framework Conversion on Climate (UNFCCC) dealing with greenhouse gases emission mitigations, adaptation finance starting in
the year 2020. At global level,
In coming decades, the Southern African Development Community (SADC) region is expected to experience higher land and ocean surface temperatures than in the past, which will affect rainfall, winds, and the timing and intensity of weather events. SADC is committed to
The Zambian Government adopted a national conservation strategy in 1985 and the National Environmental Action Plan (NEAP) in 1994, in an attempt to redress the imbalance between development and environment. Environment is one of the three pillars of sustainable
In this regard, ZRL will look at how environmental issues and concerns will be addressed as the projects are further developed. Environmental considerations will be part of the criteria for selecting and investing in business projects.
Zambia was ranked 132nd out of 180 countries in 2016 for its climate vulnerability by the Notre Dame University Global Adaptation Index (GAIN). Zambia is highly exposed to climate change risks. The frequency and intensity of extreme events like droughts and floods in the past decade have affected agricultural season, impacting famers who are part of ZRL customer
33
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
there is a shift towards use of environmentally friendly technologies. Global climate change, land Use patterns impacting on production systems and the way companies conduct their business.
several international conventions and regional programmes to provide guidance for climate change adaptation and mitigation. All SADC member states are party to the following conventions, UNFCCC, Ramsar Conversation on Wetlands, Conventions on Biological Diversity.
development. Therefore, for any investment or development project to be sustainable, the environment and issues surrounding the environment must be addressed.
base. Encroachment by squatters along the rail line leads to vandalism of the rail infrastructure. ZRL will develop risk migration risk to deal with these climate change uncertainties.
Legal Environment
International Conventions and Treaties are in place to coordinate global response
The COMESA Customs Union, launched in June 2009, has been justified at regional level as
The Railways Act provides for the vesting of the undertaking and assets of the Zambia Railways
The Governments focus on legal reforms that are pro-business means that the ZRL should be
As a limited company in Zambia, ZRL will be required to comply with wider sector specific regulations.
34
Dimension
Issues and/or developments that are likely to impact negatively or positively on ZRL’S capacity to achieve its objectives
Effects the changes present in terms of opportunities and threats to the sector
Globally Regionally Locally Opportunities Threats
In addition, at the global level, the Customs Union (COMESA) will facilitate the integration of the region into the world economy.
an essential condition for the sustainable development and integration of the region. It will increase commercial, financial and technological exchanges, which will in turn help the region to grow in a harmonious manner.
Board in Zambia Railways Limited; guiding on the winding up and dissolution of the Zambia Railways Board.
able to operate in a more business friendly legislative environment both in terms of legal compliance costs and number of regulations which it should comply with.
ZRL will also have to ensure it complies with relevant regulations, both national and regional treaties so that the investments are not placed at risk.
35
2.3 SWOT Analysis The second tool that was used is the Internal Strengths and Weaknesses and the
External Opportunities and Threats (SWOT) analysis. ZRL has many internal strengths
that can be used to leverage and mitigate the weaknesses. The strengths show an
organisation that is resilient and able to navigate the tough waters ahead. Nevertheless,
the weaknesses are also serious enough to warrant management attention. ZRL
management will become more proactive to neutralise or blunt the impact of internal
and external challenges.
2.3.1 Internal Strengths and Weaknesses Table 2. 2: Internal Strength and Weakness
Strength Weakness 1. More bulk carrying capacity than any other
mode of transport 2. Experienced employees in the rail sector
3. Linking the most economically active towns 4. Own rolling stock 5. Safety and Physical Security
6. Availability of vast amounts of low cost
land that can be utilized to enhance activities.
7. Good Industrial Relations
8. Established internal Controls and Governance Structure
9. Existing railway Infrastructure
10. Working Train Operations Management
System
11. Strong customer base
12. Flexible Pricing system
13. Membership to Regional Bodies (SARA, SADC, COMESA)
14. Known Brand
1. Poor state of the track
2. Rolling Stock that is not fit for purpose
3. Poor state of station buildings
4. Bureaucracy in price fixation
5. Low working capital
6. Inadequate ICT infrastructure and integrated systems
7. Long transit times
8. Underutilized ZRL land
9. Ageing experienced workforce
10. Poor public image
11. Human resource development programs
12. Loss making passenger sector
36
2.3.2 External Opportunities and Challenges There are opportunities in the operating environment that ZRL will take advantage of.
This will mean also dealing with external threats that are likely to undermine its
effectiveness. The analysis shows that ZRL has tremendous opportunities to take
advantage of and lessen the impact of the external threats. There are however threats
that are beyond control of management and these will be carefully monitored and
adjustment of plans made depending on their severity.
Table 2. 3 External Opportunities and Threats
External Opportunities External Challenges (Threats) 1. Introduction of SI 2. Growth in the Zambian Mining Industry
3. Growth in the economy and manufacturing sector
4. Government incentives in the agricultural sector
5. Growth in the DRC Mining sector and regional
economic growth
6. The PPP framework by the GRZ
7. The coming up of a dry port in Eastern Province and the development of greenfield railway projects such as linking of Chipata via Petauke to Serenje, Nseluka Mpulungu, Kafue- Lion‘s Den, Solwezi-Jimbe, etc
8. National Railway Development Authority (RDA)
9. Open access with TAZARA
10. Development of a National Transport policy
11. Planned construction of a private rail line in north
western province
12. ZRL is a holding Company of two (2) subsidiary companies in Southern Africa, namely, the interstate Emerged Railways Properties (ERP) and Pan African Minerals Development Company (PAMDC) which manage mineral rights in South Africa, Victoria Falls Bridge, Victoria Falls Hotel
1. One stop border posts at Chirundu, Kasumbalesa and Nakonde make road transport more convenient
2. Technological advancements in the transport sector as well as massive Investments by Road Transporters in their fleet.
3. Uneven playing field in the transport sector
4. Rampant vandalism and encroachments
5. Inability to control what is happening in the neighboring railways for example TAZARA and SNCC
6. The fluctuating copper prices as copper is the major commodity transported.
7. Political instability in DRC
8. Dependence on imports, exports and transits as major revenue contributors were we have little control
9. The link Zambia road project
10. Delayed finalization of the Transport Policy
11. The proposed policy on the introduction of multiple rail operators
37
2.3.3 Stakeholder Analysis A Stakeholder analysis was undertaken by staff and validated through a workshop
including external stakeholders. The main analysis shows that ZRL has very powerful
and influential stakeholders. All stakeholders exhibit very high interest in the work of
ZRL. This means we will continue to engage the stakeholders and capitalise on their
contributions. We have produced a stakeholder map that summarises the various
relationships. All stakeholders on quadrant for top priority need continuous
engagement, as well as those in secondary priority. The stakeholders on the low priority
are equally important being mostly NGOs and suppliers with an interest to do business
with ZRL. ZRL will continue to engage them on a need to know basis.
STAKEHOLDER MAP
Le
ve
l o
f P
ow
er H
igh
Keep Satisfied Keep Informed, involved and contributing
Regulator bodies
Ministry of Lands
Local Councils
House of Chiefs
ZEMA
Customers
IDC
Ministry of Transport
Employees
RWUZ
Media
Contractors/Suppliers
Internal Controls
ZRL Board
Public Procurement
Financial Institutions
Lo
w
Minimal Effort Keep Informed NGO‘s
Suppliers
Potential Investors
Trade associations
SARA
Land Squatters/Encroachers
Area MP
Ministry of Justice
Police Service
Low High
Level of Interest Figure 3.1 Stakeholder Map
38
2.3.4 Strategic Engagement Plan ZRL has drawn up a strategy in order to avoid being swayed and probably get off
course in light of powerful stakeholders. This plan, whose outline is shown below the
stakeholder matrix, will therefore be the main platform for engagement and financing.
Table 2. 4 Stakeholder Engagement Strategy
What Success will look like
Leadership Team ZRL Board / MoTC / IDC
Community / Customers
Involved in the planning and implementation of the ZRL 2018 – 2022 Strategic plan
Great return, value for money, positive media, satisfied public, status symbol for the country
Great amenity and logistics solution provider as able to provide end-to-end solutions
Involve Keep Informed Keep Satisfied Minimal Effort
Stakeholders: Stakeholders: Stakeholders: Stakeholders: Customers
IDC
Ministry of Transport
Employees
RWUZ
Media
Contractors/Suppliers
Internal Controls
ZRL Board
Public Procurement
Financial Institutions
Potential Investors
SARA
Trade associations
Land Squatters / Encroachers
Area MP
Ministry of Justice
Police Service
Regulator bodies
Ministry of Lands
Local Councils
House of Chiefs
ZEMA
NGO‘s
Suppliers
Tools: Tools: Tools: Tools:
Website Meetings Reports Articles Online Articles Performance Reports Financial Reports Strategic plan execution
progress reports
Meetings
Reports
Newspaper Articles
Financial Reports
Regulatory returns
Reports
Articles
Newspapers
Website
39
2.4 Strategic Issues On basis of the Institutional and Situational analysis, it is imperative that the following
issues that are distilled be attended to during the plan period. Below are some of the
strategic issues for consideration in the ZRL Strategic Plan:
Table 2. 5: Strategic Issues
Clusters of Strategic Issues
Strategic Issues
Financial Viability and Sustainability Challenges
Failure to meet traffic and revenue targets Inadequate resources for maintenance and improvement of rolling
stock and railway infrastructure Inadequate working capital High operating costs Low debt collection Inadequate capacity to clear our debts
Operating Capacity Constraints and Quality Service Delivery Challenges
Transport Logistics Issues Inadequate capacity to offer total logistical solutions Inadequate terminal facilities Underutilisation of the available warehousing facilities Low rail market share compared to the road subsector for both
freight and passenger traffic Inability to capture growing non-traditional cargo
Infrastructure Poor state of the rail track Derailments and incidents Old and defunct train control monitoring/telecoms and signalling
system Poor state of station buildings, available warehousing facilities Lack of capacity to make improvements in maintenance methods
and procedures
Rolling Stock Lack of wagons for international traffic Poor state of the available wagons for local traffic Inadequate ancillary equipment Old rolling stock Low reliability of locomotives Low availability of locomotives Train operations Low train speeds and poor transit times Low traffic performance (traffic moved)
40
Clusters of Strategic Issues
Strategic Issues
Passenger Services Issues Poor and unprofitable Passenger service Inadequate rolling stock/ infrastructure capacity to operate
Passenger Services profitably
Strategic Partnerships and Branding and Reputation
Partnerships PPP option not fully exploited for providing solutions to ZRL
operating constraints Image Promotion/ Media Inadequate capacity to fully sponsor Kabwe Warriors FC Service Branding Inadequate public sensitization about the dangers of vandalism and
land encroachments
Organisation and ICT effectiveness and utilisation
Organisational structures issues Top heavy structure Slow and ineffective implementation of decentralisation of company
operations ICT Inadequate ICT infrastructure Low utilization of existing ICT infrastructure in company operations Lack of structured onboarding processes for new ICT initiatives Our processes are manual
Security/ Legal Rampant vandalism and theft of railway infrastructure and rolling
stock and land encroachments Inability to secure our operating premises well due to lack of
adequate resources Unresolved litigations for and against the company
Human Resource Capacity
Competent work force Implementation of the merit based remuneration Inadequate skills development (re-skilling) Low employee productivity Low appetite by employees to explore and adopt new approaches Inadequate performance management system Inadequate Succession plan Retirees
The analysis of the issues above can be clustered into four strategic themes as captured
in the strategy map in figure 2.1 below as follows:
41
2.5 ZRL Strategy Map
Figure 2. 1: Strategy Map
42
CHAPTER 3
3 STRATEGIC DIRECTION: VISION, VALUES AND MISSION This section covers the main Plan and is informed by analysis of previous chapters. The
strategic direction that ZRL will take is already predetermined in the 7NDP, IDC
strategy, National Transport Master Plan and National Transport policy. The ZRLSP is
therefore an effort to domesticate for ZRL its precise role in consideration of both the
micro environment within ZRL and its operating environment externally. The following
Vision and Mission statements are supporting the achievement of the Seventh National
Development Plan (7NDP) which is in line with the Zambia Vision 2030.
3.1 Our Vision To be the preferred regional rail transport and logistics provider.
3.2 Our Values
Team Work
WE value teamwork. We believe team work will sustain efficiency and effective service
delivery. We recognize the contribution and value of individuals in a team.
Integrity
WE will do what we say we will do. We will up-hold professional and ethical business
practices. The company's interactions with stakeholders will be done transparently for
mutual benefits. We will ensure honesty, integrity and respect to all.
Innovation
WE are creative, bold and believe in continuous learning. We believe these will sustain
total quality consciousness in the organization.
Professionalism
WE uphold high quality standards and ethics in our dealings to enhance professional
competence by providing the highest level of service.
43
Service
WE believe in delivering excellent services and value customers. We take time to
understand customers‘ needs and always strive to surpass customers‘ expectations.
3.3 Our Mission To provide sustainable and competitive rail transport and logistics solutions to
customers and deliver shareholder value.
3.4 Strategic Pillars and Key Result Areas (KRA) The plan is summarized in the figure below, demonstrating how the pillars link with
strategic elements and the four perspectives of financial, customer and stakeholder,
internal business process and organizational capacity. These will be the areas of impact
for the plan period.
Figure 2. 2 Summary Balance Scorecard and Strategic Pillars
3.5 PILLAR 1: Financial Stewardship and Viability KRA 1: Financial Strength and Sustainability
Strategic Objective 1.1: Increase Profits
44
Strategies:
Increase customer base by providing competitive rates
Restore track and rolling stock condition
Acquire new equipment
Increase ZRL‘s gross revenue generation from USD 20 Million to USD 128million
per annum over the plan period
Strategic Objective 1.2: Optimize Resources
Strategies:
Manage and reduce man power related costs
Reduce fuel cost by implementing fuel management systems
Improve operational efficiency
Strategic Objective 1.3: Improve Liquidity
Strategies:
Intensify debt collection
To achieve 90% debt collection starting in 2018
financial discipline
Constant engagement with debtors and creditors.
Engaging potential financiers, banks, cooperating partners, stakeholders
Strategic Objective 1.4: Reduced Exposure to Enterprise Risks
Strategies:
Percentage of risks above the tolerable category as per risk register
Dismantle the debt owed to former employees in two years with a 50% reduction
YoY
3.6 PILLAR 2: Customer Satisfaction
KRA 2: Safe and Reliable Delivery of Quality Service to Customers and Stakeholders
Strategic Objective 2.1: Improve tonnage traffic
Provision of competitive rates through special discounts
Promotional rates
45
Backhaul rates/ through rates
prioritize long haul movements to
Strategic Objective 2.2: Increase market share
Offering reliable and competitive services
Enactment of SI
Intensified direct marketing, advertising
Acquire 3,100 new wagons, 40 new locomotives and 40 new passenger coaches
Lease to own
Hire
Improve service delivery (acquisition of new coaches, increase passenger train
speeds to 100km/h)
Strategic Objective 2.3: Improve reliability and availability of the rolling stock fleet
Strategies
Acquire 3,100 new wagons and new 40 locomotives/
Secure funding/ Lease to own/Hire
Remanufacture Locos
Rehabilitate existing fleet
Restore and upgrade track condition
Provide adequate rolling stock/ infrastructure capacity
Strategic Objective 2.4: Improve Customer Satisfaction
Strategies:
Increase customer base by providing competitive rates
Strategic Objective 2.5: Strong Stakeholder engagement
Strategies:
Maintain good relations with government and all other stakeholders
3.7 PILLAR 3: Operational Excellence KRA 3: Organizational Strength and Operational Effectiveness
Strategic Objective 3.1: Efficient and effective business processes
46
Strategies:
Timely implementation of projects
Create high performance work culture
Re-align the organizational structure in line with the business demands by 2018
To implement the decentralization of company operations by Dec, 2018
Strategic Objective 3.2: Improve train operations efficiency
Strategies:
Reduce average transit time for freight trains from 72 hours to 20 hours by 2022
Passenger transit time on mainline to 12 hours
Reduced fuel usage by intensifying the implementation of fuel management
systems
Reduced wagon and locomotive turn around periods
Prioritization of long haul movements
Strategic Objective 3.3: Reduce derailments and accidents
Strategies:
Full track rehabilitation
Upgrade the train control monitoring/telecoms & signaling system
Install Signaling and Train Telecommunications System
Strategic Objective 3.4: Improve Infrastructure
Strategies:
Rehabilitate and upgrade all station buildings, ware housing facilities, etc
Secure appropriate funding
Achieve 100% OSH compliance and quality standards by 2022
Undertake full rehabilitation of the railway infrastructure
Install Signaling and Train Telecommunications System
Strategic Objective 3.5: Improved ICT infrastructure
Strategies:
• Acquire and utilize ICT
• Implementation of train Management systems
47
• Operationalise Sage ACPACC ERP
• Human Resource management systems
• Planned maintenance management system
• Enhance utilization of ICT in company operations
3.8 PILLAR 4: Strong Brand and Partnerships
KRA 4: Competitive and Reputable Brand with Strong Strategic Partnerships in the
Region and Internationally
Strategic Objective 4.1: Enhanced Corporate Reputation
Strategies:
Increased visibility of ZRL
Enhanced Stakeholders' satisfaction
Attain International Quality Service Certification (ISO) by Dec 2022
Strategic Objective 4.2: Increase strategic partnerships
Strategies:
Secure funding for feasibility studies beginning in 2018
The utilization of ZRL bare land by developing modern structures
The development of Inter-modal terminal facilities
Commercialization of the Kabwe workshops
The development of a concrete sleeper factory
The running of the Lusaka Commuter Train
Establishment of quarry plant in Nankunko
Strategic Objective 4.3: Settlement of all cases for and against ZRL
Strategies:
Ensure that ZRL acts in accordance with the governing laws of Zambia and
regulations so as to reduce the number of lawsuits.
Ensure that ZRL is compliant to all laws and statutes
48
3.9 PILLAR 5: Human Capital and Capacity KRA 5: Committed, Competent and High Performing Workforce
Strategic Objective 5.1: Improve Recruitment and Retention
Strategies:
To develop an attractive and competitive reward system
Implement a merit based remuneration system by 2018
Implementation of employee performance appraisal
Review pay regularly with periodic assessments of salary marketplace
Strategic Objective 5.2: Improve staff productivity
Strategies:
Implement training and development plan
Implement effective recognition and reward system
Create a conducive work environment
Sustenance of industrial harmony
Strategic Objective 5.3: “Learning organization” culture nurtured and strengthened
Strategies:
Implementation of training & development programmes
Mentorship programmes
Succession plan to be 100% in place and implemented
To assist in tracking the progress during the implementation of the Strategic Plan, an
implementation matrix has been developed. It details the specific objectives, strategies,
activities, Service Delivery Target (SDTs) and Key Performance Indicator (KPIs) as
below:
49
KRA 1: Financial Strength and Sustainability
BSC Perspective
Strategic Objectives
Strategies KPI Service Delivery Target
Responsible Directorate
Financial Stewardship Perspective
Increase Profitability
- Increase customer base by providing competitive rates
- Restore track and rolling stock condition - Acquire new equipment - Increase ZRL‘s gross revenue generation
from USD 20 Million to USD 128million per annum over the plan period
- Annual Revenue - Freight revenue of USD123 million by 2022
- Passenger Revenue of USD3 million in 2022
- Estates revenue of 2 million by 2022
Marketing
Optimize Resources
- Manage and reduce man power related costs
- Fuel cost by implementing fuel management systems
- Improve operational efficiency
- O&M ratio and G&A to revenue ratio
- Dismantle debt owed
to former employees in 2 years
- Company operational cot to revenue ratio (maximum cost to income ratio) of 90% beginning 2019
- 0 Debt by end of 2021 Q2 (10% reduction per quarter for 10 quarters)
Operations Finance
Improve Liquidity - Intensify debt collection - To achieve 90% debt collection beginning
2018 - financial discipline - Constant engagement with debtors and
creditors. - Engaging potential financiers, banks,
cooperating partners, stakeholder
- Rate of debt collection
- Debtors Days
- Creditors days
- Compliance
- Resource mobilization
- 90% debt collection beginning 2018
- Reduce debtors‘ days to 30 beginning 2018
- Reduce creditors days to 45 days
- Achieve 100% compliance in terms of statutory returns and payments
-
Finance
Reduced Exposure to Enterprise Risks
- % of risks above the tolerable category as per risk register
- - Audit and Risk
50
KRA 2: Safe and Reliable Delivery of Quality Service to Customers and Stakeholders
BSC Perspective
Strategic Objectives
Strategies KPI Service Delivery Target
Responsible Directorate
Customer and
Stakeholder Perspective
Improve tonnage traffic
- Provision of competitive rates through special discounts
- Promotional rates - Backhaul rates/ through rates - prioritize long haul movements to
- Aligned Rates
- Tonnage moved / annum
- Strategy aligned Rate Sheets by Q1 of every year
- 1.2 million tons in 2018 - 1.9 million tons in 2019 - 2.8 million tons in 2020 - 3.6 million tons in 2021 - 4 million tons in 2022 - Minimum 400km/ton over
the plan period
Marketing Operations
Increase market share - Offering reliable and competitive services
- Intensified direct marketing, advertising
- Enactment of SI - Acquire 3,100 new wagons, 40 new
locomotives and 40 new passenger coaches
- Secure funding - Lease to own - Hire
- Improve service delivery (acquisition of new coaches, increase passenger train speeds to 100km/h)
- Market Share per service offered
- # of Marketing Campaign / year
- Approved SI - Acquisition of New
Rolling Stock
- Passenger speed of 100km/hr by 2021
- Market share of 30% by 2022
- Approved marketing plan in Q1 of every year
- SI Delivered by Q2 2018 - 700 wagons by 2018 - 1,700wagons by 2019 - 2,200 wagons by 2020 - 2,800 wagons by 2021 - 3,100 wagons2022 - 14 new locos by 2019 - 40 new locos by 2022 - 40 coaches by 2020 - At least 10km/hr
improvement/year
Marketing Legal Technical Services Operations
Improve reliability and availability of the rolling stock fleet
- Acquire 3,100 new wagons and new 40 locomotives/
- Secure funding/ Lease to own/Hire - Remanufacture Locos - Rehabilitate existing fleet - Restore and upgrade track condition - Provide adequate rolling stock/
infrastructure capacity
- Loco Reliability - Loco Availability - Wagon Availability - Increased passenger
ridership
By 2022 - Reliability of
10,000km/failure - Availability of 80% - Speeds of 100km/h for
passenger by 2022 - 30 coaches by 2020
Technical Services Operations Technical Services
Improve Customer Satisfaction
- Increase customer base by providing competitive rates
-
- Customer retention Surveys
- Customer Satisfaction Surveys
- Customer retention of 80% over the plan period
- Customer Satisfaction of 85% by 2021
Marketing
Strong Stakeholder engagement
- Maintain good relations with government and all other stakeholders
-
- Stakeholder satisfaction index - Stakeholder Satisfaction Index of 85% by 2021
Public relation
51
KRA 3: Organizational Strength and Operational Effectiveness BSC Perspectives
Strategic Objectives
Strategies KPI Service Delivery Target
Responsible Directorate
Internal Business Process
Perspective
Efficient and effective business processes
- Timely implementation of projects - Create high performance work culture - Re-align the organizational structure in line
with the business demands by 2018 - To implement the decentralization of
company operations by Dec, 2018
- Projects deliverables overdue
- New Organisation structure
- Decentralised model
- <10% Project deliverables overdue
- Organisation Structure deployed by Q2 2018
All Directors
Improve train operations efficiency
- Reduce average transit time for freight trains (L/Stone-Ndola) from 72 hours to 20 hours by 2022
- Passenger transit time on mainline to 12 hours
- Reduced fuel usage by intensifying the implementation of fuel management systems
- Reduced wagon and locomotive turn around periods
- Prioritization of long haul movements
- Transit time - Fuel consumption
index - Average distance
covered per ton
- 20 hours on the mainline for freight trains by 2022
- 12 hours for passenger trains on mainline by 2022
- 0.014 L/NTK over the plan period
- Wagon and Loco Turn Around times
- Minimum of 400km/ton over the plan period
Operations
Reduce derailments and accidents
- Full track rehabilitation - Upgrade the train control
monitoring/telecoms & signaling system - Install Signaling and Train
Telecommunications System
- Achieve almost zero derailments
- 100% Safety and economic means of controlling train movements
- Full rehabilitation of entire network
- Restoration of old equipment
- Acquisition of new rolling stock by 2022
Technical Services
Improve Infrastructure
- Rehabilitate and upgrade all station buildings, ware housing facilities, etc
- Secure appropriate funding - Achieve 100% OSH compliance and quality
standards by 2022 - Undertake full rehabilitation of the railway
infrastructure - Install Signaling and Train
Telecommunications System
- Upgrade of station buildings and infrastructure
- Average train speeds
- All buildings by 2022 - Safety and
environmental compliance of 100%
- 80-100km/h for freight & passenger trains by 2022
Technical Services Technical Services
Improved ICT infrastructure
- Acquire and utilize ICT - Implementation of train Management
systems - Sage ACPACC - Human Resource management systems - Planned maintenance management system - Enhance utilization of ICT in company
operations
- Over the plan period Operations
52
KRA 4: Competitive and Reputable Brand with Strong Strategic Partnerships in the Region and Internationally
BSC Perspective
Strategic Objectives
Strategies KPI Service Delivery Target
Responsible Directorate
Internal Business Processes
Perspective
Increase strategic partnerships
- Secure funding for feasibility studies beginning in 2018
- The utilization of ZRL bare land by developing modern structures
- The development of Inter-modal terminal facilities
- Commercialization of the Kabwe workshops
- The development of a concrete sleeper factory
- The running of the Lusaka Commuter Train
- Establishment of quarry plant in Nankunko
- Implementation of the projects identified for PPP over the plan period
- Implementation of the projects identified for PPP over the plan period
Corporate Planning / Procurement and Supplies.
Settlement of all cases for and against ZRL
- Ensure that ZRL acts in accordance with the governing laws of Zambia and regulations so as to reduce the number of lawsuits.
- Ensure that ZRL is compliant to all laws and statutes
- Reducing no. Old Cases per year (10% reduction / Quarter)
- No. of new Cases per year
- Old Case disposed of by Q2 2019
- Less than 2 new cases per year
Legal Legal
Enhanced Corporate Reputation
- Increased visibility of ZRL - Enhanced Stakeholders' satisfaction
- Attain International Quality Service
Certification (ISO) by Dec 2022
- Rebranding of ZRL - Customer Satisfaction
Index
- ISO certification
- Completed rebranding Program by Q4 2018
- Customer Satisfaction Index improvement of 10% per annum
- Half yearly progress report
Marketing Public Relations Legal Services
53
KRA 5: Committed, Competent and High Performing Workforce
BSC Perspectives
Strategic Objectives
Strategies KPI Service Delivery Target
Responsible Directorate
Organization
al Capacity
Improve Recruitment and Retention
- To develop an attractive and competitive reward system
- Implement a merit based remuneration system by 2018
- Implementation of employee performance appraisal
- Review pay regularly with periodic assessments of salary marketplace
- New reward system in place
- Development of incentive schemes
- Job evaluation - Salary surveys
- Yearly Employee
Opinion Surveys (EOS)
- Rate of attrition
- Approved reward system by Q1 2019
- Job evaluation results
and Salary surveys by Q1 2019
- EOS Index of 85% by 2022
- Attrition of less than 4% annually
Human Resources and Administration Public Relations HRA
Improve staff productivity
- Implement training and development plan - Implement effective recognition and
reward system - Create a conducive work environment - Sustenance of industrial harmony
- Develop training effectiveness index
- Performance management system
- Employee productivity ratio
- Annual leave plans
- Index of 85% per annum
- 100% smart performance contracts up to Manager level Q1 of every year
- Productivity ratio of 2300tons/employee per annum by 2022
- Revenue productivity ratio of USD74,000 per employee per year) by 2022
- 90% adherence to annual leave plans
Human Resources and Administration
―Learning organization‖ culture nurtured and strengthened
- Implementation of training & development programmes
- Mentorship programmes - Succession plan to be 100% in place and
implemented
- No. of employees under-going training/month
- Succession Plan
- 80% against training plan
- Annual approved succession plan by Q1 of every year
Human Resources and Administration
54
CHAPTER 4
4 GOVERNANCE, INSTITUTIONAL FRAMEWORK FOR
IMPLEMENTATION
4.1 Governance
The key Champion in ensuring the implementation of the strategic plan rests with the
top leadership in any organization. In the case of ZRL, the Chief Executive Officer
(CEO) will take the overall responsibility of ensuring that the plan is successfully
implemented. The CEO will be supported by the six directorates who will be in charge
of all operational aspects of the plan implementation. These include the:
a. Directorate of Finance
b. Directorate of Legal Services (company Secretary)
c. Directorate of Operations
d. Directorate of Technical Services
e. Directorate of Human Resources and Admin
f. Directorate of Marketing
Various governance structures and support functions in ZRL will work in harmony to
ensure smooth implementation of the plan.
4.2 Institutional Arrangements
To ensure smooth implementation of the Plan, the Strategic Plan Implementation
Committee (management team) will be charged with the responsibility of ensuring that
the strategic plan is cascaded to directorates and other departments in ZRL. The
Corporate Planning Department will be tasked to ensure that ZRL‘s key results areas
and strategic objectives are aligned to ZRL vision. The Corporate Planning Department
will liaise with other departments and sections to support this goal. It is envisaged that
there will be a champion to spearhead each of the Key Result Areas in the plan. An
organisation structure that will support this strategy is annexed to this plan.
The reporting system is diagrammatically presented below:
55
4.3 ZRL Performance Reporting Flowchart
Figure 4. 1: Performance Reporting Flowchart
To further support performance monitoring, a ZRL M&E Plan and System will be
developed and institutionalized. The Corporate Planning team will lead the process of
developing an M&E framework for the plan. The M&E plan will have a detailed set of
indicators against which data will be collected at various levels. This strategic plan has
provided the key performance indicators as a starting point to support data gathering
4.4 Resource Mobilization, Financial Management and Procurement
Financing of this strategic plan will be informed by the MTEF and annual budget cycle
in line with the fiscal year for the Republic of Zambia. ZRL will adopt a proactive
approach to engage the IDC and the GRZ to leverage Government funding. To
compliment this, support from development partners will be sought. It is anticipated
that development partners will be approached to support ongoing transformation of
ZRL and bridge the financing gaps. A resource mobilization strategy will be elaborated
upon once the resource estimates for implementing the strategic plan over the five years
has been worked out. In the resource mobilization strategy, development partners with
interest in the respective KRAs will be identified, and a framework for engaging them
elaborated. Financial management approaches that are consistent with good public
Strategic Pillars
Key Results Areas
MissionVision
Imp
lem
enta
tio
n P
lan
Strategic Objectives
Strategies
Monthly Reports
Quarterly Reports
Annual Reports
Mid Term Reports
ZRL Board
Management Team
Ministry of Transport
IDC
PACRA
56
financial management principles will be adopted. ZRL will enhance existing systems as
stated in the Financial KRA. Prudence will be exercised to ensure value for money.
Procurement will be guided by the public procurement laws, with a procurement plan
being prepared and adhered to on an annual basis. This requires that the procurement
section will have to undertake a user needs assessment exercise in time, create
awareness among the users on the importance of identifying user needs and
specifications in time and avoid delays in executing planned activities.
4.5 Investment Estimates for 2018 – 2022
Qty
Estimated
Cost (USD) Qty
Estimated
Cost (USD) Qty
Estimated
Cost (USD) Qty
Estimated
Cost (USD)
1 Rolling Stock Activities:
1.1 Purchase of Wagons 700 49,000,000 1,100 110,000,000 1,300 130,000,000 3,100 289,000,000
1.2 Purchase of New Locomotives 4 20,000,000 10 50,000,000 26 130,000,000 40 200,000,000
1.3 Periodical Overhaual of Existing 7 8,400,000 - - - - 7 8,400,000
1.4 Passenger Coaches - - 40 23,000,000 - - 40 23,000,000
1.5 Diesel Multi Units - - 4 32,000,000 - - 4 32,000,000
1.6 Subtotal Rolling Stock Activities 77,400,000 215,000,000 260,000,000 552,400,000
2 Workshop Equipment:
2.1 Wheel Re-Profiling Lathe 1 3,000,000 - - - - 1 3,000,000
2.2 Other Workshop Equipment - - - - 1 15,000,000 1 15,000,000
2.3 Subtotal Workshop Equipment 3,000,000 - 15,000,000 18,000,000
3 Rail Infrastructure Activities:
3.1 Concrete Sleepers 170,000 8,500,000 100,000 5,000,000 250,000 12,500,000 520,000 26,000,000
3.2 Ballast (Cubic Meters) 460,000m3 13,805,500 - - 140,000 4,200,000 600,000m3 18,005,500
3.3 91lb Rails (Km) 190Km 15,795,000 790Km 106,600,000 100Km 17,000,000 1,080 Km 139,395,000
3.5 Bridges and Station Buildings Various 2,300,000 - - Various 76,630,000 Various 78,930,000
3.6 Procurement of Inspection Trolleys - - 6 345,000 - - 6 345,000
3.7 Rail Track Support Equipment - - - - Various 12,000,000 Various 12,000,000
3.8 Rail Connectivity Various 10,000,000 Various 19,000,000 Various 27,000,000 56,000,000
3.9 Subtotal Infrastructure Activities 50,400,500 130,945,000 149,330,000 330,675,500
4 Signalling System & Others
4.1 Signalling/Telecoms System 1 10,000,000 - - - - 1 10,000,000
4.2 Working Capital 10,000,000 10,000,000
4.3 Implementation of PPP Projects 7 1,200,000 - - - - 7 1,200,000
4.4 Subtotal Signalling & Others 21,200,000 - 21,200,000
5 Grand Total 152,000,500 345,945,000 424,330,000 922,275,500
Grand Total
S/No. Particulars
Survival/Short Term (2018) Medium Term (2019-2020) Long Term (2021-2022)
Figure 4. 2 Investment Cost 2018 – 2022
For ZRL to achieve its goals and attain the projected profit levels, a sum of USD922
Million will have to be invested in the organisation. These funds will be sourced with
the help of the Government and other cooperating business partners, including through
Public Private Partnerships (PPP). In the 7NDP for instance, the Government has
indicated that it will commence the revitalisation of the 1,224-km Zambia Railways
Line, including the inter-mine line at a cost of US$1.3 billion during the plan period of
the 7NDP 2017-21.
57
CHAPTER 5
5 PERFORMANCE MONITORING
5.1 Introduction ZRL will undertake two levels of monitoring and evaluation. The first level is at the
ZRL itself and the performance of its activities. The strategic plan implementation
matrix contains performance indicators for purpose of performance monitoring.
Evidence based data will be collected in line with the key performance indicators on
regular basis. It is anticipated performance monitoring reports from various directorates
will be presented in line with the objectives of this strategic plan. Administrative and
support departments will also present their annual performance reports during the
review.
On regular basis i.e. monthly, quarterly, biannually and annually, performance reports
will require to be submitted to directly governance organs and stakeholders. The
Corporate planning department will check for monitoring the progress on activities
being undertaken.
The M&E team (corporate planning department) will develop manuals detailing the
procedures to be followed to ensure comprehensive data collection, analysis and
dissemination. The M&E manuals will show which data will be collected, how it will be
collected and captured, analysed, presentation and disseminated and how it will be
used to improve decision making within ZRL.
Target based performance appraisal will be introduced for both management and staff.
The targets will be drawn from the strategic plan and cascaded to various departments,
sections and units in an integrated and consistent and coherent manner. It is anticipated
that this will improve strategy implementation and success of ZRL as an institution.
A Monitoring and Evaluation framework will be developed and rolled out to enhance
the implementation of the plan.
58
5.2 Corporate Goals and Performance Metrics In today‘s fast-moving and technologically-driven world, seamless coordination
between the ZRL Directorates is critical. ZRL has set five corporate goals to drive
performance across the company. By striving for common goals, the priorities of each
Directorate will be better aligned and cooperation between teams will increase. The
goals align with the strategic elements.
A series of metrics and five-year performance targets for each goal has been established
to measure progress against a clear timeline. Performance plans for employees at all
levels of the company will be tied to these metrics — beginning with the Executive
Committee and cascading throughout the organization as appropriate.
This process helps ensure that all employees are contributing not only to their team or
Directorate, but also to the corporate goals.
Note: Metrics and performance targets may be adjusted or changed over time in
response to changing external factors and internal business needs.
ZRL has chosen metrics aligned with global best practice. However, these may be
changed or removed in response to business needs.
Additionally, ZRL is considering other metrics for future use once improvements have
been made to IT and data reporting systems. These improvements will allow the
company to more accurately capture key information and drill down to business line
and route levels. See Appendix 1 for definitions of metrics.
5.3 Factors That Could Affect Goal Achievement As captured in the performance matrix, ZRL has set future performance targets that are
realistic, timely and achievable. However, there are many external factors outside of
ZRL‘s control that may have a negative impact on future performance and prevent the
company from reaching its goals.
59
1. Capital Investment
ZRL — and its ability to carry out this strategic plan — depends upon continuing
support from Government along with significant investments from the private
sector in the form of potential loans and strategic partnership. While ZRL has
continues to reduce its debt burden in the past five years, the company‘s credit
standing could be worsened as a result of the financial conditions and actions of
Government support.
ZRL will continue to depend upon adequate annual levels of capital investment
to maintain its infrastructure, systems, rolling stock and stations in a ―state of
good repair‖ for both safety and operational efficiency. Adequate investments
are also necessary to support improvement of ZRL‘s cost to income ratio.
Significant cuts and fluctuations in investments will impede ZRL‘s ability to
reach its performance targets. Additionally, the timing of Government support
remains a challenge to ZRL‘s ability to execute planned improvements.
Appropriate investments are also necessary to improve open up new green field
projects and generate additional net revenues needed to pay for future long-
distance and corridor rolling stock. Significant cuts and fluctuations in
investments will impede ZRL‘s ability to reach its performance targets.
2. Operating Assistance
It has been the policy of Government to have an intercity, interconnected rail
system that takes advantage of Zambia‘s central location and its being land
linked. The safe and reliable operation of a national network that provides basic
surface mobility to citizens is up to now completely dependent upon adequate
annual government appropriations over the long-term. Failure by government to
support the operation of this system with the needed level of appropriations will
lead to some services, such as passenger services being considered for
elimination.
60
3. Economic Conditions
The economic turnaround in the region in the last couple of years presents an
opportunity for ZRL to expand its operation and to be the most reliable regional
logistic company. There has also been an increased interest in strategic partners
willing to invest in the ZRL operations. It is important that in choosing a strategic
partner ZRL and IDC work closely together to negotiate a deal that will be of
economic benefit to the country as a whole.
4. Statutory Requirements
The implementation of statutory and legal mandates requires money, time and
attention from management. ZRL in this strategy has adopted a zero tolerance to
regulatory breaches approach. It will endeavour to be 100% compliant with all
regulatory requirements.
5. Natural and Human-Caused Disasters
ZRL‘s performance can be seriously disrupted by natural and human-caused
disasters. Land encroachments, Wildfires, floods, mudslides and acts of
vandalism all have the potential to damage the infrastructure needed to operate
trains. Future disasters may negatively impact performance.
6. Energy Costs
Large portions of the company‘s operating costs are driven by prices for diesel
fuel and electricity. Spikes in energy costs can greatly affect ZRL‘s ability to fund
other programs and projects that are necessary to achieve its goals.
7. Internal Factors
ZRL must assess several key internal factors to ensure it is capable of reaching its
performance targets. These factors include risk assessment, organizational
structure, business processes, human capital management and information
technology. The company must ensure these factors align with its strategic needs
and long-term vision.
61
CHAPTER 6
6 THE RAILWAY SUB-SECTOR: TRENDS AND EMERGING ISSUES
6.1 Introduction The railway sector plays the role of an economic engine in the development of
countries. The Growth of economies correlates positively with the growth of the
railways. India, China, Brazil and European countries, etc have achieved economic
growth through railway investments. The subsector sector allows nations to take
advantage of economies of scale.
In other words, the railway sector is very much linked and influences developments in
other sectors of the economy. Indeed, it affects attainment of all eight Sustainable
Development Goals (SDGs).
However, when compared to the road subsector, the freight and passenger market
share by rail is in the range of 10% to 15% on the African continent today.
6.2 International Developments Most African countries face huge costs associated with transportation. In accessing
foreign markets, on average, Africa‘s transport and insurance costs represent 30% of the
total value of exports, which compares unfavourably with 8.6% in developed countries.
Although most countries in African share the problem of high transport costs,
landlocked countries face the most excessive transport costs (in the range of 50% to 60%
of the total value of goods and services) the continent.
Transit times on African transport corridors are unduly long due to factors such as
unclear and sometimes conflicting rules and regulations, inefficient service providers,
road blocks, as well as cumbersome administrative and customs procedures. These
have created a serious challenge to transport facilitation and trade on the continent. It
leads to excessive traffic delays, resulting in substantial increase in transport costs.
62
Road traffic accidents kill 1.2 million people in the world per year. Out of this number,
over 40%, are on African roads. Moreover, Africa has the highest number of road traffic
accidents per capita.
Today, the continent has a total railway network of over 95,000 km or 3.1 km of per
1,000km2, most of which is disjointed. With the exception of North Africa, railways in
Africa generally have a low level of traffic mainly due to poor railway infrastructure.
When compared to the road subsector, the freight and passenger market share by rail is
in the range of 10% to 15%.
In recent years, African governments have allocated 6-8 per cent of their GDP annually
to infrastructure development including the transformation of the railway subsector. In
Zambia for instance, the Government has indicated that it will commence the
revitalisation of the 1,224-km Zambia Railways Line, including the inter-mine lines at a
cost of US$1.3 billion in the 7NDP covering the period 2017-21.
6.3 Actions taken and progress made in Zambia The GRZ is taking a number of concrete actions and made some progress towards
implementation of railway transport-related commitments and goals contained in the
7NDP, the NTMP and the NTP. Some of the measures identified and/or being taken are
highlighted below:
1. Full rehabilitation and upgrade of the railway infrastructure and the
development of an integrated cargo and passenger rail (the transformation of the
railway sub sector into an efficient, reliable, safe, and competitive transport mode
with appropriate interfaces with the other modes of transport).
2. The development of the following Greenfield railway projects so as to link
Zambia to almost all the trade corridors in the sub-region.
Chipata- Serenje via Petauke involving 389km
Kafue- Lions Den via Chirundu involving 306km
63
Nseluka-Mpulungu via Mbala (191km)
Livingstone-Katima Mulilo via Kazungula (200km)
Chingola-Jimbe via Solwezi (600km)
3. The review of legislative framework in the railway sub-sector in Zambia (review
of the Railways Act of Zambia).
4. The separation of railway operations from railway infrastructure development
and maintenance (the establishment of a railway authority and introduction of a
rail regulator).
5. Future plans to build railway lines to standard gauge.
6.4 Passenger and Freight Traffic Trends in Zambia The Annual GDP Growth Rate in Zambia is expected to be 3.80% by the end of 2017,
according to Trading Economics global macro models and analysts‘ expectations. In the
long-term, the Zambia GDP Annual Growth Rate is projected to trend around 5.00% in
2020, according to the econometric models.
Arising from the increased economic activity, Zambia is undergoing a trend of
urbanization which is quickly increasing urban populations. The result of urbanization
in terms of transportation is increased travel demand. According to the Central
Statistical Office (CSO), the population of Zambia is projected to increase to nearly 40
million people in 2035 out of which 40% shall be in urban areas especially along the line
of rail.
In terms of freight, traffic in Zambia is mainly composed of imports, exports and transit
traffic between Zambia and the rest of the countries in the sub-region. The other type of
traffic is local or domestic traffic within Zambia.
The projected production of copper in Zambia and south of the Democratic Republic of
Congo (DRC) is projected to increase from the current 1.2 million tons per annum to 2.3
million in 2020 and 3 million in 2025. Similarly the demand for imported mining inputs
64
such as sulphur, chemicals and industrial machinery is expected to increase. Other
imports projected to increase include fuels, fertilisers, daily supplies, product oil, etc.
With the projected increase in economic activities, the movement of other export
commodities such as cobalt, manganese, agricultural products, timber, etc, is
anticipated to heighten as well. Likewise, the movement of domestic commodities vis-à-
vis sugar, cement, agricultural products, coal, etc, is also expected to continue
increasing.
Railway transport has a great advantage in the transportation of the above highlighted
various industry and mining commodities mainly because of its technical and economic
features.
6.5 Monitoring and Assessment of the Trends and Emerging Issues A Technical Committee will be constituted to look at the future of the railway subsector
in Zambia. The committee will monitor and assess the global trends of the sub-sector.
With that appraisal they will narrow it down to the sub- region and eventually ZRL.
65
7 ANNEXES
66
7.1 Annex 1: PROJECTED YEAR ON YEAR KEY RESULTS FOR THE PLAN PERIOD Strategic Objective KPI Unit of
Measure Base Line 2016
KPI Targets Over the Plan Period (Year on Year)
S/No. S/No. 2018 2019 2020 2021 2022
1 Improve traffic to 4 million tons per annum by 2022.
1 Tonnes of cargo moved Million tons 0.6 1.2 1.9 2.8 3.6 4.0
2 Average distance covered per ton Km 345 400 410 410 415 420
3 Freight revenue/annum Million USD 14 32 58 84 109 123
4 Average Earning/Ton USD 24 27 30 30 30 31
4 International to Local Traffic Ratio 1/1 3/2 3/2 3/2 3/2 3/2
2 To increase the freight market share from 8% to 30% by 2022
5 Freight market share 8% 10% 16% 21% 28% 30%
3 To increase the passenger market share from 12% to 25% by 2022
6 No. of long distance passengers (long distance) moved per year No. 243,000
198,848 223,081 239,926 262,228 350,810
7 Passenger market share 12% 12% 15% 16% 18% 25%
8 Passenger revenue/annum
Million ZMW 12 9 19 23 24 28
4 To improve the of the rail track to accommodate speeds of 80-100km/h for freight and passenger trains respectively by 2022.
9 Freight Trains Km/h 20 20 30 50 70 80
10 Passenger Km/h 30 30 40 60 80 100
11 Percentage of track on TSR % 5% 5% 4% 2% 1% 1%
5 Acquire new 3,100 wagons, 40 locomotives and 40 passenger coaches by 2022
12 No. of available new locos No. -
4
14
24 30
40
13 No. of available new wagons No. -
1,100 1,700
2,200 2,800
3,100
14 No. of available new coaches No. -
- 20 40 40 40
6 To improve reliability and availability through enhanced maintenance
15 Locomotive reliability Km/Failure 2,542
7,000 10,000 10,000 10,000
10,000
16 Locomotive Availability % 80% 80% 80% 80% 80% 80%
17 Wagon Availability % 80% 80% 80% 80% 80% 80%
7 Increase gross revenue generation to USD128 million in 2022
18 Annual revenue generated Million USD 17 34 61 87 113 128
To have overall operational costs within 90% of total revenue
19 O&M to Revenue Ratio % 107% 75% 75% 75% 75% 75%
20 G&A to Revenue Ratio % 18% 15% 15% 15% 15% 15%
8 Improve train operations efficiency 21
Average transit time for freight trains (LRS-NDR) Hours 72 72 60 40 30 20
22 Average transit time for passenger trains (LRS-NKA) Hours 58 58 36 24 18 12
23 Fuel consumption index L/NTKM 0.0165 0.014 0.014 0.014 0.014 0.014
9 Employee productivity 24 Tonnage/Employee-Year)
Ton/Emp-Yr) 624
1,200 1,500
1,800 2,200
2,300
25 Revenue/Employee-Year USD/Emp-Yr) 17,400
34,000 48,158 55,929 69,056
73,600
67
7.2 Annex 2: Organization Chart
68
7.3 Annex 3: Comprehensive Profit and Loss Statement Item Total Grand Total 2018 2019 2020 2021 2022
Transport Statistics:
Tonnage 13,500,000 1,200,000 1,900,000 2,800,000 3,600,000 4,000,000
Ton-Km 5,581,000,000 480,000,000 779,000,000 1,148,000,000 1,494,000,000 1,680,000,000
Average Distance 413 400 410 410 415 420
$- Ton $30 $27 $30 $30 $30 $31
Cent-Ton-Km 7 7 7 7 7 7
Tonnage Break-Even Point 14,338,290 1,511,361 1,883,499 3,099,670 3,941,918 3,934,899
Particulars: Total -US$ Total - ZMW 2018-US$ 2018-ZMW 2019-US$ 2019-ZMW 2020-US$ 2020-ZMW 2021-US$ 2021-ZMW 2022-US$ 2022-ZMW
Revenue:
Freight Revenue $405,000,000 4,050,000,000 $32,000,000 320,000,000 $57,000,000 570,000,000 $84,000,000 840,000,000 $109,000,000 1,090,000,000 $123,000,000 1,230,000,000
Passenger Train Revenue $10,315,000 103,150,000 $900,000 9,000,000 $1,900,000 19,000,000 $2,300,000 23,000,000 $2,415,000 24,150,000 $2,800,000 28,000,000
Real Estate Revenue $7,025,940 70,259,400 $810,000 8,100,000 $972,000 9,720,000 $1,263,600 12,636,000 $1,895,400 18,954,000 $2,084,940 20,849,400
Interest Receivable $40,713,000 407,130,000 $3,393,000 33,930,000 $840,000 8,400,000 $14,640,000 146,400,000 $20,220,000 202,200,000 $1,620,000 16,200,000
Other Income $237,304 2,373,042 $45,600 456,000 $46,512 465,120 $47,442 474,422 $48,391 483,911 $49,359 493,589
Total Revenue $463,291,244 4,632,912,442 $37,148,600 371,486,000 $60,758,512 607,585,120 $102,251,042 1,022,510,422 $133,578,791 1,335,787,911 $129,554,299 1,295,542,989
Expenditure:
Man Power Costs $143,816,691 1,438,166,913 $15,973,898 159,738,980 $18,227,554 182,275,536 $30,675,313 306,753,127 $40,073,637 400,736,373 $38,866,290 388,662,897
Fuel and Lubricants $92,658,249 926,582,488 $7,429,720 74,297,200 $12,151,702 121,517,024 $20,450,208 204,502,084 $26,715,758 267,157,582 $25,910,860 259,108,598
Repairs and Maintenance $88,025,336 880,253,364 $7,058,234 70,582,340 $11,544,117 115,441,173 $19,427,698 194,276,980 $25,379,970 253,799,703 $24,615,317 246,153,168
Administration $46,329,124 463,291,244 $3,714,860 37,148,600 $6,075,851 60,758,512 $10,225,104 102,251,042 $13,357,879 133,578,791 $12,955,430 129,554,299
Operating Expenses $23,164,562 231,645,622 $1,857,430 18,574,300 $3,037,926 30,379,256 $5,112,552 51,125,521 $6,678,940 66,789,396 $6,477,715 64,777,149
Total Expenditure $393,993,963 3,939,939,632 $36,034,142 360,341,420 $51,037,150 510,371,501 $85,890,875 858,908,755 $112,206,185 1,122,061,845 $108,825,611 1,088,256,111
Operating profit [EBITDA] $69,297,281 692,972,811 $1,114,458 11,144,580 $9,721,362 97,213,619 $16,360,167 163,601,668 $21,372,607 213,726,066 $20,728,688 207,286,878
Depreciation, Provision for Retirement and Finance Charges
Depreciation $23,218,706 232,187,065 $2,431,127 24,311,275 $3,185,130 31,851,300 $4,391,534 43,915,340 $4,160,852 41,608,525 $9,050,062 90,500,625
Provision for retirement $10,800,000 108,000,000 $1,500,000 15,000,000 $1,900,000 19,000,000 $2,300,000 23,000,000 $2,500,000 25,000,000 $2,600,000 26,000,000
Finance Expenses & Exchange Loss $2,136,040 20,990,400 $337,700 3,377,000 $382,700 3,827,000 $407,700 4,077,000 $485,470 4,854,700 $522,470 4,854,700
Total $36,154,746 361,177,465 $4,268,827 42,688,275 $5,467,830 54,678,300 $7,099,234 70,992,340 $7,146,322 71,463,225 $12,172,532 121,355,325
Profit Before Tax $33,142,535 331,795,346 ($3,154,369) (31,543,695) $4,253,532 42,535,319 $9,260,933 92,609,328 $14,226,284 142,262,841 $8,556,155 85,931,553
Provision for tax $12,703,916 127,039,164 0 0 1,488,736 14,887,362 3,241,326 32,413,265 4,979,199 49,791,994 2,994,654 29,946,544
Profit After Tax $20,438,618 204,756,182 ($3,154,369) (31,543,695) $2,764,796 27,647,957 $6,019,606 60,196,063 $9,247,085 92,470,846 $5,561,501 55,985,010
69
7.4 Annex 4: Cash Flow Statement
Item 2018-US$ 2018-ZMW 2019-US$ 2019-ZMW 2020-US$ 2020-ZMW 2021-US$ 2021-ZMW 2022-US$ 2022-ZMW
Opening Cash Balance ($500,000) (5,000,000) $101,256,571 1,012,565,714 $8,700,966 87,009,658 $260,966,268 2,609,662,680 $367,032,246 3,670,322,465
Inflows
Collections from Previous Year's Debtors $0 0 $6,400,000 64,000,000 $11,400,000 114,000,000 $16,800,000 168,000,000 $21,800,000 218,000,000
Freight Revenue $32,000,000 320,000,000 $57,000,000 570,000,000 $84,000,000 840,000,000 $109,000,000 1,090,000,000 $123,000,000 1,230,000,000
Total $32,000,000 320,000,000 $63,400,000 634,000,000 $95,400,000 954,000,000 $125,800,000 1,258,000,000 $144,800,000 1,448,000,000
Less: Freight Revenue Uncollected ($6,400,000) (64,000,000) ($11,400,000) (114,000,000) ($16,800,000) (168,000,000) ($21,800,000) (218,000,000) ($24,600,000) (246,000,000)
Freight Revenue Inflow $25,600,000 256,000,000 $52,000,000 520,000,000 $78,600,000 786,000,000 $104,000,000 1,040,000,000 $120,200,000 1,202,000,000
Collections from Previous Year's Debtors $0 0 $1,287,150 12,871,500 $939,628 9,396,280 $4,562,761 45,627,606 $6,144,698 61,446,978
Estates $810,000 8,100,000 $972,000 9,720,000 $1,263,600 12,636,000 $1,895,400 18,954,000 $2,084,940 20,849,400
Passenger Train Revenue $900,000 9,000,000 $1,900,000 19,000,000 $2,300,000 23,000,000 $2,415,000 24,150,000 $2,800,000 28,000,000
Interest Receivable $3,393,000 33,930,000 $840,000 8,400,000 $14,640,000 146,400,000 $20,220,000 202,200,000 $1,620,000 16,200,000
Other Income (way leaves) $45,600 456,000 $46,512 465,120 $47,442 474,422 $48,391 483,911 $49,359 493,589
Total Other Income $5,148,600 51,486,000 $5,045,662 50,456,620 $19,190,670 191,906,702 $29,141,552 291,415,516 $12,698,997 126,989,967
Less: Estates Rev. Uncollected ($1,287,150) (12,871,500) ($939,628) (9,396,280) ($4,562,761) (45,627,606) ($6,144,698) (61,446,978) ($1,638,575) (16,385,747)
Inflows - From Other Rev. Streams $3,861,450 38,614,500 $4,106,034 41,060,340 $14,627,910 146,279,097 $22,996,854 229,968,539 $11,060,422 110,604,220
Total Inflow $29,461,450 294,614,500 $56,106,034 561,060,340 $93,227,910 932,279,097 $126,996,854 1,269,968,539 $131,260,422 1,312,604,220
Loan amount $152,000,500 1,520,005,000 $0 0 $345,945,000 3,459,450,000 $424,330,000 4,243,300,000 $0 0
Grand Total $181,461,950 1,814,619,500 $56,106,034 561,060,340 $439,172,910 4,391,729,097 $551,326,854 5,513,268,539 $131,260,422 1,312,604,220
Outflows
Previous Year's Creditors Payments $8,500,000 85,000,000 $4,012,049 40,120,488 $6,561,919 65,619,193 $11,043,113 110,431,126 $14,426,509 144,265,094
Man Power Costs $15,973,898 159,738,980 $18,227,554 182,275,536 $30,675,313 306,753,127 $40,073,637 400,736,373 $38,866,290 388,662,897
Fuel and Lubricants $7,429,720 74,297,200 $12,151,702 121,517,024 $20,450,208 204,502,084 $26,715,758 267,157,582 $25,910,860 259,108,598
Repairs and Maintenance $7,058,234 70,582,340 $11,544,117 115,441,173 $19,427,698 194,276,980 $25,379,970 253,799,703 $24,615,317 246,153,168
Administration $3,714,860 37,148,600 $6,075,851 60,758,512 $10,225,104 102,251,042 $13,357,879 133,578,791 $12,955,430 129,554,299
Operating Expenses $1,857,430 18,574,300 $3,037,926 30,379,256 $5,112,552 51,125,521 $6,678,940 66,789,396 $6,477,715 64,777,149
Cost of feasibility studies $1,200,000 12,000,000 $0 0 $0 0 $0 0 $0 0
Acquisition of New Rolling Stock & Loco Remanufacture$14,500,000 145,000,000 $37,700,000 377,000,000 $58,550,000 585,500,000 $199,157,500 1,991,575,000 $182,319,500 1,823,195,000
Rail Infrastructure rehabilitation & new connectivity $20,700,125 207,001,250 $53,820,325 538,203,250 $42,016,300 420,163,000 $131,789,250 1,317,892,500 $128,089,500 1,280,895,000
Procurement of new Signalling & Telecoms $2,500,000 25,000,000 $6,500,000 65,000,000 $1,000,000 10,000,000 $0 0 0
Less payable following year ($4,012,049) (40,120,488) ($6,561,919) (65,619,193) ($11,043,113) (110,431,126) ($14,426,509) (144,265,094) ($13,991,864) (139,918,643)
Total Outflows $79,422,218 794,222,182 $146,507,605 1,465,076,046 $182,975,982 1,829,759,822 $439,769,538 4,397,695,376 $419,669,256 4,196,692,562
Cash Available Before Finace Exp. $102,039,732 1,020,397,318 ($90,401,571) (904,015,706) $256,196,927 2,561,969,275 $111,557,316 1,115,573,162 ($288,408,834) (2,884,088,343)
Loan Repayments
Interest expenses $0 0 $0 0 $0 0 $0 0 $5,080,936 50,809,360
Principal Amounts $0 0 $0 0 $0 0 $0 0 $15,200,050 152,000,500
Total Loan + Interest Payments $0 0 $0 0 $0 0 $0 0 $20,280,986 202,809,860
Cash Available Before Bank Charges $102,039,732 1,020,397,318 ($90,401,571) (904,015,706) $256,196,927 2,561,969,275 $111,557,316 1,115,573,162 ($308,689,820) (3,086,898,203)
.
Other Payments
Bank Charges $60,000 600,000 $95,000 950,000 $120,000 1,200,000 $165,000 1,650,000 $202,000 2,020,000
Finance lease $223,160 2,231,604 $570,299 5,702,988 $570,299 5,702,988 $347,138 3,471,384 $360,032 3,600,321
Income Tax $0 0 $1,488,736 14,887,362 $3,241,326 32,413,265 $4,979,199 49,791,994 $2,994,654 29,946,544
Total - Other payments $283,160 2,831,604 $2,154,035 21,540,350 $3,931,625 39,316,253 $5,491,338 54,913,378 $3,556,686 35,566,865
Cash Available from yearly Operating Activities $101,756,571 1,017,565,714 ($92,555,606) (925,556,056) $252,265,302 2,522,653,022 $106,065,978 1,060,659,784 ($312,246,507) (3,122,465,068)
Closing Cash Balance $101,256,571 1,012,565,714 $8,700,966 87,009,658 $260,966,268 2,609,662,680 $367,032,246 3,670,322,465 $54,785,740 547,857,397
Note: Interest and Principal payable for the loans starts in year 5 on the USD152 million short term investment needs
70
7.5 Annex 4: Statement of Financial Position ASSETS 2018 2019 2020 2021 2022
Non-currents assets
Property, plant and equipment 441,750,857 1,767,104,057 2,588,051,217 5,855,910,192 8,523,554,567
Capital Work-in-progress 61,013,475 61,013,475 61,013,475 61,013,475 61,013,475
Investments 4,687,500 4,687,500 4,687,500 4,687,500 4,687,500
507,451,832 1,832,805,032 2,653,752,192 5,921,611,167 8,589,255,542
Currents assets
Trade receivables and Other receivables 677,258,492 242,142,176 380,999,524 262,970,334 519,076,647
Inventories 116,162,143 185,134,645 229,794,136 366,377,908 638,033,886
Cash and cash equivalents 1,012,565,714 87,009,658 2,609,662,680 3,670,322,465 547,857,397
1,805,986,349 514,286,479 3,220,456,340 4,299,670,706 1,704,967,930
Total assets 2,313,438,180 2,347,091,511 5,874,208,532 10,221,281,873 10,294,223,472
EQUITY AND LIABILITIES
Capital and reserves
Share capital 197,756 197,756 197,756 197,756 197,756
Amounts received pending allotment of shares 627,228,974 627,228,974 627,228,974 627,228,974 627,228,974
Reserves (186,210,467) (158,562,510) (98,366,447) (5,895,600) 50,089,409
441,216,262 468,864,220 529,060,283 621,531,129 677,516,139
Loan 1,520,005,000 1,520,005,000 4,979,455,000 9,222,755,000 9,222,755,000
Non-current liabilities 1,520,005,000 1,520,005,000 4,979,455,000 9,222,755,000 9,222,755,000
Current liabilities
Trade and other payables (appendix) 195,374,019 214,911,421 236,402,563 260,042,820 286,047,102
Accruals and provisions (appendix) 132,766,898 116,834,870 102,814,686 90,476,924 81,429,231
Taxation payable 26,476,000 26,476,000 26,476,000 26,476,000 26,476,000
354,616,918 358,222,292 365,693,249 376,995,743 393,952,333
TOTAL EQUITY AND LIABILITIES 2,315,838,180 2,347,091,511 5,874,208,532 10,221,281,873 10,294,223,472
Recommended