Zimbabwe says China eyes $10bn investment
Fin24

Zimbabwe says China eyes $10bn investment

2011-01-31 18:46

Harare - China Development Bank could fund up to $10bn in Chinese investment in Zimbabwe's mining and agriculture sector, a big boost for a country struggling to attract foreign investors, a government minister said on Monday.

Isolated by the West over charges of human rights abuses and election fraud, President Robert Mugabe has increasingly looked for help from China, which is pushing onto the continent in search of natural resources for its expanding economy.

"We have met with officials from China Development Bank and they have said they are willing to invest up to $10bn in Zimbabwe," Tapiwa Mashakada, minister of economic planning and investment promotion, told Reuters on the sidelines of a business conference in Harare.

Such an investment would dwarf Zimbabwe's gross domestic product (GDP), which is expected to be about $6bn this year.

No immediate comment was available from the Chinese embassy in Harare.

Mashakada told the conference he expected Zimbabwe to produce about 1.5 million tonnes of maize in 2011, up from 1.3 million a year before. He saw gold production hitting 13 tonnes in 2011, up from 8.3 tonnes in 2010.

Zimbabwe also has the world's second largest platinum reserves.

China is "looking into mining development, that is exploration and exploitation, agriculture, infrastructure development and information communication technology," said Mashakada, a minister from Prime Minister Morgan Tsvangirai's Movement for Democratic Change party.

He would not say if the investment would come this year.

The announcement could be aimed at trying to prod Western investors to sink more money into Zimbabwe out of fear they will lose ground to China.

China's investment has been growing steadily in Zimbabwe over the last decade but it still lags behind what Beijing invests in neighbouring Mozambique, Zambia and Angola.

A unity government formed between Mugabe and Tsvangirai in 2009 has brought stability to an economy crushed by hyperinflation about two years ago.

However, the authorities have failed to attract foreign investment, especially from traditional Western investors who want more political reforms and are worried about a law that says 51% of firms worth over $500 000 should be owned by black Zimbabweans.

China's exports to Zimbabwe amounted to $159m in 2010 while the southern African country exported $57m worth of goods, according to official figures.

Analysts accuse Beijing of ignoring human rights abuses by African leaders as it pursues the resources needed to fuel its rapid economic growth.

Chinese investors have snapped up commercial and residential properties in the capital Harare over the past few years.

"The Chinese are now moving towards strict due diligence, accountability and transparency. At the end of the day this really depends on us, how we position ourselves as a destination for investment," said Mashakada.

"China is coming in a very big way."

Comments
  • PonkieDiel - 2011-01-31 19:07

    Zimbabwe, the next Chinese province. Can't wait for the Chinese street names to go up.

  • mike - 2011-01-31 19:14

    GREAT!! THE CHINESE GET MORE LIVING SPACE AND GRACE AND BOB GET MORE MONEY FOR THEIR SHOPPING SPREES AND TO BOOST THEIR MALAYSIAN BANK ACCOUNT!!

  • ror - 2011-01-31 19:17

    How many times have we heard this b/s before - absolute nonsense. There is nothing left in Zimbabwe worth investing money in! How do you run a business with no electricity? The Chinese have been along time in Zim and what have they achieved - nothing.

  • William - 2011-01-31 19:25

    I wonder what their pound of flesh will be?

  • Proffie - 2011-01-31 19:32

    Be afraid. Be very afraid.

  • KK - 2011-01-31 21:06

    Um..throw out the white people and put in the Chinese who only care about themselves. Idiots!

  • Kevin - 2011-01-31 21:32

    We all heard about the Rhodesians bgeing sold out.This affected the Zim populace apart from the war lords.The sell out to the new yellow colonist will again hurt the same people...The west created this and the east will profit...Just a very long drawn out slow game....Sick !

  • Steve - 2011-02-01 08:57

    This should be seen as good news by all. Let the chinese get a foothold, bring in their own workers, ban trade unions, and then I want to see how the locals react. The likes of Malema and co. would have to shut up quickly, as the Chinese would not "stand for their cr@p"

  • c'est moi - 2011-02-04 17:48

    anybody knows the volume of FDI from China in Zimbabwe since the past 5 years..

  • AJ - 2011-05-22 03:14

    Buying a country is very different from investing in it. China is doing the former not the latter.

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