On Life Support: 31 State Companies on the Brink of Collapse, Auditor-General Warns

In the world of business, there is a term called “going concern.” It’s a simple but vital idea: it means a company is healthy enough to keep its doors open and pay its bills for the foreseeable future. When an auditor flags a company as a “going concern risk,” it is the financial equivalent of a doctor telling a patient they are in critical condition. It is a stark warning that the company could soon collapse.

Now, imagine that a warning has just been issued for 31 of the most critical companies in Zimbabwe—the very entities responsible for our transport, power, and national wealth.

The Auditor-General’s 2024 report has done exactly that, sounding a deafening alarm over the financial health of our state-owned enterprises (SOEs). These are not just obscure companies; they are household names, and their potential collapse threatens the very fabric of our nation’s economy and public services. Crippled by staggering losses, suffocating debt, and a chronic inability to make money, these 31 entities are on life support, and the Zimbabwean taxpayer is footing the bill for their intensive care.

The list of the afflicted is a who’s who of Zimbabwe’s parastatal sector, including:

The stories behind these warnings are deeply troubling. Take Air Zimbabwe, our national airline. The report reveals it is drowning in debt, with accumulated losses reaching a staggering USD 69.6 million in 2023. Its liabilities—what it owes—are USD 16.5 million more than the entire value of its assets. It is, in simple terms, bankrupt on paper.

Then there is the National Railways of Zimbabwe (NRZ), the backbone of our nation’s transport and industry. The AG found it had a net current liability of ZWL$12.8 billion in 2022 and was failing to service its foreign loans. The trains are not just grinding to a halt on the tracks; the entire organization is financially derailing.

Even newer entities created to empower citizens are failing. EmpowerBank, established to support youth entrepreneurs, is operating with a capital level far below the USD 5 million required by the Reserve Bank. The Auditor-General states this “indicates a material uncertainty that may cast significant doubt on the Microfinance Bank’s ability to continue as a going concern.” The very bank meant to empower the next generation cannot sustain itself.

The report reveals a toxic cocktail of problems common to nearly all 31 entities. They are chronically underfunded, unable to invest in new equipment or maintain what they have. They are plagued by revenue leakages, where money that should be coming in simply disappears. And they are haunted by massive legacy debts that grow larger each year as interest accumulates, creating a debt spiral from which there is no easy escape.

The economic implications are severe. These failing companies are a constant drain on the national budget, pulling money away from critical areas like healthcare and education. Their inability to provide reliable services—be it electricity, water, or transport—hampers economic growth and makes life harder for every Zimbabwean.

The Auditor-General’s report is not just a set of financial statements; it is a red alert for the nation. The time for patch-work solutions and bailouts is over. A radical overhaul is needed. This may mean painful restructuring, finding credible investors for recapitalization, or making the tough decision to privatize entities that have proven they cannot be run efficiently by the state. Without bold and immediate action, these 31 companies will not just remain on life support—they risk dragging the entire economy down with them.