Chinese under fresh pressures over Zim deals

LUSAKA — ZAMBIA’s inflation rate has declined to 15.1 per cent this month due to favorable price movements in food items. In addition, Zambia’s cumulative total trade for the period of 2020 to December 2021 stood at K359.4 billion, representing a 48.3 per cent increase. Zambia Statistics Agency (ZamStats) interim statistician general Mulenga Musepa announced that the annual inflation rate decreased to 15.1 per cent in January 2022 from 16.4 per cent the previous month. This meant that on average, prices of goods and services increased by 15.1 per cent between January 2021 and January 2022 –

AN American think tank on Friday added its voice to growing disquiet by Zimbabweans over resource exploitation claims by Chinese firms, following a week of deep accusations.

The American Enterprise Institute (AEI) said while over US$11 billion in investment and contracts had been signed since 2005, scales were largely tipped in favour of the world power.

AEI, which spoke as Chinese firms controlling massive interests in Zimbabwe clashed with NGOs over resource plunder claims, said deals between Harare and Beijing reached US$11,64 billion last year.

This figure represented about 64,5% of Harare’s gross domestic product (GDP), estimated by the World Bank at US$18,05 billion in 2020.

AEI said of the US$11,64 billion, publicly disclosed investments and contracts worth US$1,37 billion were signed last year.

“The growing investments have not translated into any meaningful development that have benefited the citizens owing to myriad dynamics that perpetuate exploitation and extreme poverty, which include but not limited to rent-seeking, economies of affection corruption, poor negotiations by the government as well as Chinese economic and political muscle (geopolitics),” AEI said in the report titled; ‘China Global Investment Tracker’.

Chinese authorities were last week forced to wade into a standoff between Beijing’s companies operating in Zimbabwe and “superfluous” NGOs, with

Beijing boasting that without the world power’s investments, Harare would be “candle lit” and struggling without internet.

China has emerged as the biggest source of investment into Zimbabwe since Harare’s diplomatic tiff with Western powers two decades ago, which led to a damaging embargo.

Despite investing the US$11,6 billion, Chinese multinationals have had a frustrating time in Zimbabwe, where they face accusations spanning from labour and human rights violations to environmental degradation, tax evasion and foreign currency externalisation. Beijing has rebuffed the claims. Confrontations hit tipping point last Friday after the rebuttal by 27 NGOs, who claimed, in a statement, that Chinese firms were displacing hundreds of villagers from chrome fields, gold claims and coal mines in their hunt for Zimbabwe’s mineral resources.

The Chinese embassy said the “dubious” NGOs’ combative claim “stinks of a hideous agenda from groups that make a living from political advocacy”.

“Were it not for China’s funding support and the work of Chinese companies in ICT and power generation, even the statement in question would perhaps have to be scribbled on a piece of paper, in a candle-lit room, and never find its way on a functioning internet,” Chinese diplomats said in a statement.

The embassy claimed that NGOs’ work pale into insignificance compared to 100 000 Zimbabweans employed by Chinese companies.

“Suffice to say that they are significantly outnumbered by the Zimbabwean employees working in companies established with Chinese investment and outnumbered by the ordinary Zimbabwean citizens who are benefiting from ChinaZimbabwe cooperation…Chinese Stateowned and private businesses have been making great contribution to the improvement of local people’s livelihoods. Dragging Chinese investors into political sideshows or making them victims of domestic political vendettas hurts the people of Zimbabwe and the development of the country as a whole. It is a way of extending sanctions by trying to force Chinese investment out of the country to make Zimbabwe more vulnerable,” added the embassy.

But as the standoff continued, the Zimbabwe Coalition on Debt and Development (Zimcodd) separately argued that China was the beneficiary of the two countries’ economic ties.

“The only thing that has been tangible and affected the citizens is the growing external debt which is now hovering at US $13,2 billion,” Zimcodd said.

“It is against this background that citizens and various pressure groups have questioned the utility of mega-deals (between Zimbabwe and China) in bringing about societal transformation and development. In 2012, the government announced that China Railway was going to inject US$1,2 billion, to resuscitate the National Railways of Zimbabwe by developing a high-speed train which was to operate between Harare and Bulawayo. Ten years later, transport crisis has become the order of the day. There is no high-speed route to talk about between Harare and Bulawayo,” Zimcodd argued.