Thursday, November 17, 2011

(NEWZIMBABWE) China keen to expand economic ties

China keen to expand economic ties
16/11/2011 00:00:00
by Business Reporter I Agencies

CHINA is keen to expand farming, mining and infrastructure projects in Zimbabwe, in a development officials expect to help mitigate the impact of declining investment flows from the West. Zimbabwe is pushing for local control of the country’s economy, attracting criticism from the West and warnings this could deter much-needed foreign capital.

But Vice President Xi Jinping Xi, likely to succeed Hu Jintao as China's president from early 2013, voiced no such criticisms during a meeting with President Robert Mugabe in Beijing on Wednesday.

"His Excellency the president is a famed leader of the national liberation movement in Africa, and also an old friend whom the Chinese people know well," said Xi.
"China is willing to join hands with Zimbabwe, enhance friendly exchanges, and expand practical cooperation," he added.

Shunned by the West, Mugabe has increasingly sought help elsewhere, especially in China, whose companies covet the mineral resources of the southern African country.

Zimbabwe has demanded that most foreign mining companies in Zimbabwe surrender 51 percent of their local equity to blacks in the country.

But Zimbabwe has excluded Chinese mining firms from the demand, sending a signal to foreign miners that if they do not agree to the demands, they could lose their prospecting rights to Chinese competitors.

In March, China signed nearly $700 million in loan deals with Zimbabwe, and urged the government to protect Chinese firms from nationalisation plans.

China's investments have been growing steadily in Zimbabwe and include diamond and chrome mining, platinum concessions, road construction, cotton and tobacco companies as well as a cement manufacturing plant.

In the first nine months of this year, trade between China and Zimbabwe grew to $717.3 million in value, a rise of 62.2 percent on the same period last year, according to Chinese customs statistics.

The Government says it has secured deals worth over US$700 million with various Chinese investors who are interested in the extracting and processing of minerals in the country

In an interview with New Ziana after a recent trip to China, mines and mining development permanent secretary, Prince Mupazviriho said his delegation had been overwhelmed by the enquiries from investors willing to invest in the mining sector.

“We signed transactions estimated at between US$700 million and US$750 million with investors eager to do mineral extraction and beneficiation,” he said, adding that Zimbabwe's vast mineral wealth could help invigorate the fragile economy.

Mupazviriho added that the Chinese investors were also keen to extract alluvial diamonds in the country, following the decision by the Kimberley Process and Certification Scheme (KP) to allow the Southern African country to market its gems without restrictions.

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