Zim-China trade grows 57pc

29 Aug, 2022 - 00:08 0 Views
Zim-China trade grows 57pc Ambassador Guo Shaochun

The Herald

Oliver Kazunga

Senior Business Reporter

TRADE between Zimbabwe and China grew by 57 percent to US$973 million in the first six months of the year driven by intensive efforts of the two governments and the private sector.

China, which is the largest economy in Asia and only second after the US in the world, enjoys cordial relations with Zimbabwe and trade between the two nations has in recent years been growing tremendously.

Speaking at the inaugural Zimbabwe Annual Investment Forum in Harare last week, China Ambassador to Zimbabwe Guo Shaochun said in view of the global economic disruption caused by the Covid-19 pandemic, this was a great achievement that is significant to maintain Zimbabwe’s economic vitality.

“With the concerted efforts of the governments and enterprises, the trade between China and Zimbabwe has kept growing.

“In the first half of this year, the bilateral trade volume reached US$973 million with an increase of 57 percent, of which China imported US$504 million from Zimbabwe and exported US$469 million to Zimbabwe, up 103 percent and 26 percent respectively,” he said.

Zimbabwe and China have always been partners with a shared future and both countries have suffered from imperialism and colonialism for a long time.

Amb Guo said the shared experiences, historic mission and common ideals have brought the two nations close together even in the areas of trade and investment.

In the past 42 years, he said following the principles of sincerity, real results, affinity and good faith and with concrete actions, China has been supporting Zimbabwe to realize its national development, overcome the negative impact of illegal sanctions and stay interacting with the global economy.

“Under the strategic guidance of President Xi Jinping and President Mnangagwa, China and Zimbabwe have enjoyed ever-growing excellent relations and sound bilateral cooperation across the board.”

Some of the major investment projects by the Chinese in Zimbabwe include the well-known National Pharmaceutical Warehouse, the 1 000 Borehole Project, the new Parliament Building, and the High-Performance Computing Centre, all implemented with China aid.

Other projects include the Kariba South Hydro Power Station Expansion, Hwange Thermal Power Station Expansion, Victoria Falls International Airport Upgrading, Expansion and Upgrading of the Robert Gabriel Mugabe International Airport and Net-One broadband construction, all supported by China’s concessional loans.

The protocol of phytosanitary requirements for export of Zimbabwean fresh citrus to China signed last year is one of the policies by China in promoting export of Zimbabwe’s agricultural products.

“We encourage more well-established and capable Chinese companies to invest in Zimbabwe.

“The construction of Dinson Iron and Steel Company invested by China’s Tsingshan Corporation is well on track.

“Through open bidding on the international market, some Chinese large enterprises have invested in local lithium mines and are revitalizing the resources that were long idled by western companies,” said Amb Guo .

Over the years, many Chinese enterprises have also invested in other sectors such as tobacco planting and export, crop farming, building materials manufacturing, and freight logistics.

“These investments introduce Zimbabwe’s high-quality products into international markets, bring Zimbabwe considerable forex earnings and tax revenues, tens of thousands of job opportunities and technology transfers and promote Zimbabwe’s competitiveness in the global economy.”

Amb Guo noted that following their political independence, African countries have made tireless efforts toward national development and economic revitalisation.

In this process, he said a shortage of funds for development and the need for external financing are the challenges that countries in the continent have to face.

“Therefore, Africa’s debt situation is in nature an issue of development, so is Zimbabwe’s debt situation.

“The solution lies in ensuring the effective use of funds and loans and increasing capacity for self-generated development.

“However, instead of truly helping Africa promote economic growth, some financing from Western countries mainly focus on non-manufacturing sectors, and even come with political strings attached such as political reforms in receiving countries.

“Such financing can easily end up as unpayable bad loans.”

Based on such logic, he said China has been carrying out cooperation with Zimbabwe by focusing on the real and urgent needs of the country, adding that the grants and financial support by that Asian nation always follow the principles of openness and transparency.

According to the estimates of the United Kingdom’s Debt Justice based on World Bank data, the interest rates of China’s official and commercial loans to African countries are lower than the interest rate (5 percent) on commercial loans from other countries.

They are also far lower than the interest rates (of 4-10 percent) on the 10-year government bonds, according to the numbers disclosed by the African Development Bank.

“Besides, the sovereign loans provided by China come with a fixed interest rate, while Western commercial creditors usually apply fluctuating interest rates.

“As the US dollar enters its rate hike cycle, the debtor countries are facing growing pressure on repayment.

“The so-called ‘Chinese debt trap’ is a lie made up by some Western countries and politicians to deflect responsibility and blame.

“What African people should stay alert to and try their best efforts to shake off is the ‘trap of underdevelopment’ and the ‘trap of intervention in internal affairs by external forces’.

“Chinese Government has consistently required Chinese enterprises to abide by the laws and policies of host countries, protect the environment, respect labour rights, take their social responsibilities and accept supervision of the Zimbabwean authorities and public scrutiny,” he said.

Amb Guo said his country firmly supports the Government in continuously refining the regulatory framework to enhance supervision on all foreign investments and foster a more favourable investment climate.

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