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(NEWZIMBABWE) Chinese companies 'bleeding' economy: Zanu PF MP

Chinese companies 'bleeding' economy: Zanu PF MP
09/12/2011 00:00:00
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ZANU PF legislator, Paddy Zhanda has demanded a review of China’s involvement in the economy as it emerged the government has had awarding contracts worth more than half a billion dollars to foreign companies. Zhanda said Chinese involvement was “bleeding” the economy at a time local companies were struggling to survive with many people unable to find work.

The MP, who chairs the parliamentary portfolio committee on budget, finance and investment promotion, revealed the figure while presenting a report on the 2012 national budget.

"$553m worth of contracts were awarded to foreign companies, and most of these to Chinese companies," Zhanda was quoted as saying.

"Zimbabwe has a very high unemployment rate and a liquidity crisis and we implore the minister of finance, Tendai Biti, to stop this bleeding."
Zhanda reportedly said the projects awarded to foreigners included the construction of flats in Harare at a cost of $7m.

He added: "A few examples of these projects include construction of Lupane State University to cost $10m, National University of Science and Technology to cost $4m, a project at the University of Zimbabwe to cost $2m, Beitbridge Waterworks to cost $4m, construction of the new parliament of Zimbabwe complex in Kopje to cost $134m, and others."

Projects awarded to Chinese companies include the construction of a defence college on the outskirts of Harare.

But economist John Robertson said Zhanda's comments were "unfair" and took a different view.

He agreed that in principle local firms should compete for tenders, but he said that most of the skilled workforce has left the country and Zanu PF policies have destroyed the country's capacity to compete against foreign firms, who have more resources.

"I think Zhanda is being critical for a political reason. Zanu PF members of government are constantly trying to find ways of criticising MDC members for whatever they have done or failed to do" Robertson said.

Zimbabwe received a Chinese loan of $98m to build the college, to be repaid over 20 years through earnings from the Marange diamond fields, which are being mined by Chinese firm Anjin Investments and the Zimbabwe army.

Some of the gems, worth $160m, went on sale this week for the first time since the lifting of an international ban by the Kimberley Process.

The government says China plans up to US$10 billion in investments over the next five years, more than any other country.

Chinese economic activity in Africa is often a source of controversy, with allegations that China is underpaying for mineral resources and either mistreating local workers or importing its own.

Labels: CHINA, PADDY ZHANDA, ZANU-PF

posted by MrK @ 11:41 AM