HARARE, Oct. 25 (Xinhua) -- Zimbabwean state enterprises and parastatals recorded a 270 million U.S. dollar loss in 2016, Chief Secretary to the President and Cabinet Misheck Sibanda said Wednesday.
Addressing a workshop on the Public Entities Corporate Bill, Sibanda attributed the loss to ineffective internal control systems, which resulted in management paying themselves hefty pay at the expense of service delivery.
"Audited financial statistics for 2016 for 93 state enterprises and parastatals (SEPs) revealed an overall loss of 270 million dollars by the 38 surveyed commercial entities," Sibanda was quoted as saying by the state-run news agency New Ziana.
He said 70 percent of 93 SEPs were either "technically insolvent" or "illiquid."
Sibanda said weak corporate governance and ineffective internal control systems significantly contributed to the under-performance of state enterprises.
"Some entities have operated for extended periods without a full board," he said. "In one case, admittedly extreme, a strategic entity was run by a one-person board for more than two years."
He said the Public Entities Bill, currently before parliament, is designed to address those governance weaknesses.
Speaking at the same occasion, Finance and Economic Development Minister Ignatius Chombo reaffirmed the government's commitment to addressing weak corporate governance prevalent across state entities.
"The days of no boards, incomplete boards, one-man boards, nonexistent board committees and indefinite acting CEOs are well and truly gone," he said.
The newly appointed finance minister said bonuses, if they were to be paid at all in state-owned entities, should only be awarded after annual audited financial statements confirmed a satisfactory overall entity performance.
President Robert Mugabe recently threatened to shut down perennially non-performing state-owned firms.
The sector's contribution to national gross domestic product has slumped to around 2 percent, down from 40 percent two decades ago.
