Jiangsu Invests Heavily In Zimbabwe

Via herald.co.zw

The increasing interest being shown by Chinese provinces and cities to invest in Zimbabwe is a good development towards the much-needed economic turnaround.

The Chinese provinces should be lauded for taking a leaf from their central government, which has set a good example by maintaining good mutual relations with Zimbabwe.

It is the mutual and win-win relations between the two countries that is making it possible for investors from the Asian country to venture into Zimbabwe.

By coming to Zimbabwe, the Chinese provinces are showing that it is possible to turn the good political and cultural relations between the two countries into tangible economic benefits.

The Chinese government has also realised that it cannot go it alone when it comes to investing in Zimbabwe and is thus encouraging the provinces and the private sector to come on board.

This is because the government grants which the central government used to extend to countries like Zimbabwe can no longer satisfy the mammoth developmental needs.

Government grants could only work on small projects that had little impact on Zimbabwe’s economic needs. With the private sector now on board, financial backing is guaranteed as the Chinese institutions like the China Export and Import Bank come on board to fund mega projects.

Just last week, Zimbabwe signed three Memoranda of Understanding with China’s Zhejiang Province, as the Asian country’s provinces intensify the search for investment opportunities.

The outcome of the Zimbabwe–China Zhejiang Province Investment Conference held in Harare, where the MoUs were signed, was significant.

One of the three MoUs relates to the Memorandum of Co-operation between China Council for the Promotion of International Trade Zhejiang and the Ministry of Macro-Economic Planning and Investment promotion.

The second is an Aide Mémoire between the Ministry of Macro-Economic Planning and Investment Promotion and China Industrial International Group Zimbabwe, while the third is a friendship MoU. It is important that the MoUs include the development of infrastructure such as manufacturing plant and equipment.

These are much needed to help Zimbabwe achieve its vision of quickly becoming an industrialised economy.

The interest in Zimbabwe by the Chinese provinces comes at a time the country has enacted the Special Economic Zones Act, which offers more investment opportunities.

The SEZs are meant to attract foreign direct investment, promote industry competitiveness, resuscitate ailing industries, promote value addition, enhance exports and create jobs.

It is crucial that the Minister of State for Harare Metropolitan Province Miriam Chikukwa, who was the guest of honour at the investment conference, pointed out the importance of the SEZs to investment.

“The establishment of these zones is expected to see the country attracting foreign direct investment, while at the same time creating an enabling environment for local and international trade to flourish,” she said.

Another delegation from various Chinese local authorities was in Zimbabwe last month where it expressed interest in joint venture partnerships.

The partnerships targeted four Zimbabwean cities, Harare, Chitungwiza, Epworth and Ruwa, which offer good investment opportunities in tourism, food processing and tobacco farming and processing.

The five-member delegation comprised governor of Yanbian Prefecture Li Jinghao, mayor of Yanji city Cai Kuilong and his Hunchun city counterpart Zhang Jifeng, director of Foreign Affairs in Yanbian Government Shen Zaicheng, section chief of Foreign Affairs for Yanbian Government Piao Zhe and Ding Changlu, who is the vice-general manager of Jinlin Tobacco Industrial.

Such Chinese deals usually come as joint ventures, which have always ensured there is win-win cooperation and mutual benefit. Mr Li noted that Zimbabwe had great business potential.

The interest by the Chinese provinces and municipalities in Zimbabwe is anchored on the mega deals signed between the two countries two years ago.

Some of the deals were signed when President Mugabe was on a State visit to China in 2014, while more others were signed in 2015 when Chinese President Xi Jinping paid his own State visit to Zimbabwe.

The deals are being pursued in the spirit of the Forum for China Africa Cooperation, whose 6th Summit was held in South Africa in 2015.

At the summit, President Xi set the parameters for the continued cooperation between China and African countries based on a quest to industrialise the continent.

He also outlined a 10-point plan to support a quick intervention by encouraging more Chinese investors to consider Africa as a premier destination for their cash.

Jiangsu province is another Chinese province that has shown a huge interest in Zimbabwe as a safe investment destination.

The provinces’ firm, the China Jiangsu International Economic and Technical Cooperation Group Ltd (CJI), has been active in the country through carrying out several projects. CJI launched its business in Zimbabwe in 1995.

The latest project the firm has worked on is the building and expansion of the Victoria Falls International Airport using preferential loans provided by the Chinese government.

The $150 million international airport was commissioned by President Mugabe at the end of last year.

CJI is already considering to carry out work of the same magnitude on Harare International Airport.

The expansion of Victoria Falls International Airport has greatly improved the equipment and facilities there, as well as the capability of safeguarding civil aviation security.

Already, international airlines are lining up to fly to Victoria Falls, thereby increasing the number of tourists visiting the prime resort.

Reception of international tourists is expected to increase from 500 000 to two million per year.

Wide body airplanes such as Boeing 747 and 767 and Airbus 340 and 380 can now safely land and take off on the newly-built airfield runway.

Apart from Victoria Falls International Airport, Jiangsu province has invested in areas such as iron and steel metallurgy, agriculture and construction and installation in Zimbabwe.

In 2015, Jiangsu’s trade volume with Zimbabwe totalled $56,39 million, up by 18,4 percent from a year earlier.

Of this total volume, $53,8 million were from Jiangsu’s export to Zimbabwe, up by 72,8 percent, $2,59 million import, down by 84,3 percent.

Among the exports to Zimbabwe were machines, mechanical appliances, electrical equipment, base metal and its metal works and textile raw material and textile products.

Only last year, six Chinese provinces held the Forum on Global Production Capacity and Business Cooperation in Wuhan city of Hubei province of China to seek ways of increasing their cooperation with African countries.

The provinces were Hubei, Jiangxi, Shanxi, Anhui, Henan and Hunan.

Speaking at the forum, Zimbabwean ambassador to China Mr Paul Chikawa said African countries needed to broaden their industrial base and increase production capacity.

 

 

 

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