Energy & Resources

Sensitive to digs

Pushback over mining purchases in Zimbabwe

Harare-w

Harare agreed lithium mine deal

“Were it not for China’s funding support and the work of Chinese companies in communications and power generation, [these accusations] would perhaps have to be scribbled down on a piece of paper, in a candle-lit room, and never find its way on to a functioning internet.”

That’s how the Chinese embassy in Harare responded to a mildly worded call by local NGOs asking the Zimbabwean government to consult with local communities before awarding mining contracts to Chinese companies and to enforce the payment of fair compensation packages for people who have to give up their land.

Chinese investment in Zimbabwe has soared in recent years with much of the money going into communications, power generation and, of course, mining.

This month another deal was inked – the purchase of the Bikita Lithium mine by China Mining Resources Group.

To counter growing concern that Zimbabwe is getting the rough end of these deals, Chinese state media has published several stories in recent days listing all the positives of the relationship – including the drilling of 1,000 boreholes for water since 2012.

“This availability of water near our villages has benefited us a lot because we are no longer wasting time going long distances looking for water,” a local interviewee said.

The article also described how Beijing had helped Harare prepare for the arrival of Covid, upgrading hospitals and establishing a dedicated Covid treatment centre before the virus hit.

Chinese investment in Africa comes in for a lot of criticism from some quarters for being opaque, self-serving and damaging to the nations receiving it. Yet despite a number of cases in which the complaints are valid, there are success stories too: a recent study by the London School of Economics found that Chinese investment in Ethiopia has had a real and sustained impact on local economic growth. “Our findings cast some doubt on the fierce and oftentimes ideological debate around the Chinese presence in Africa. We show that the effects of Chinese FDI are highly heterogeneous, but overall positive in the medium run,” the authors wrote.

China’s diplomatic relations with Zimbabwe date back to 1976 when Beijing backed Robert Mugabe against another independence leader and white Rhodesians in the three-way Rhodesian Bush War.

Mugabe emerged victorious and Beijing established formal ties with Harare on April 18, 1980 – the day Zimbabwe gained formal independence from Britain. China is currently building Zimbabwe a new parliament building (via grant, not loan) and Chinese banks have funded the expansion of the country’s largest coal-fired power plant, as well the extension of the Robert Mugabe International Airport in Harare.

Yet it’s mining that causes the greatest concern amongst Zimbabweans, partly because it is polluting, partly because it is dangerous work and usually because it involves government appropriation of land.

While a definitive list of all Chinese mining assets in Zimbabwe is hard to find, it clear that their ownership interests span projects from gold to granite, coal to lithium and diamonds to iron ore.

In December last year another Chinese company, also inked a deal to buy a lithium mine in the former British colony paying $422 million for the Arcadia hard-rock site near Harare. Prices of the metal have surged in recent months as the demand for electric vehicles – which use lithium in their batteries – has also skyrocketed (see WiC569).

In the case of both mines there is a question over their profitability – Bikita, for which China Mining Resources paid $180 million, has run a loss for the past two years.

Many of Zimbabwe’s civil society organisations say they are keen to stress they are not anti-China, just opposed to cases of exploitative and unfair business practices. A letter this month signed by 27 such NGOS asked that the Chinese ambassador tour some of the Chinese-owned mining sites to see for himself if their safeguarding promises are being met.“If China respects and loves Africa as it purports, then the primary sign is to place ordinary citizens at the centre of development,” the letter declared.


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