China's Zimbabwe invasion, 'analysts' dismayed

Economic analysts in Zimbabwe have expressed dismay at the manner in which the Chinese and their Asian cousins from India have been allowed to take up major businesses in the country.

Chinese companies have also entered the property sector, where they have reportedly been pushing up office and other property rentals in Harare. At it stands, Chinese companies command a significant presence in Zimbabwe's mining, retail, manufacturing, construction and other sectors of the economy and this trend is set to continue as the embattled country continues to get shunned by western and other international investors.

Zimbabwe's relations with traditional investors from western and other international countries including South Africa have soured in recent weeks following the gazetting of final regulations to govern the implementation of the controversial economic indigenization and empowerment law. Investor sentiment has been dented while other firms have halted expansionary projects in protest to the law which analysts say is likely to benefit only the well-connected and wealthy.

Mr Jeffery Kasirori economic commentator said that there are growing concerns over Chinese aggressive investments in Africa and Zimbabwe is no exception. President Robert Mugabe has found a willing partner to replace western companies with Chinese investors but he seems to be unaware that the Chinese are very cunning and are only interested in growing their businesses.

Other investment analysts said that China's foray into Africa had brought little benefit to the continent's economy in general as Chinese companies were only interested in the potential for huge returns that African economies offered.

Last month, Zimbabwe and China signed a loan agreement worth USD 585 million. The loan agreement which followed similar investment packages with Botswana and South Africa's Industrial Development Corporation which invested in the country's Agribank showed that some investors were prepared to weather the storm despite a call for early elections by Mr Mugabe and his Zanu PF party.

Mr Robert Besseling Africa analyst said that for China there is certainly a huge commercial potential, especially with western companies pulling out or being pushed out for China and other countries such as Korea and India to move in instead. Zimbabwe might have given China guarantees that investments from the Asian fastest growing economy would be protected from expropriation.

China has become a major importer of goods and products ranging from sanitary ware, detergents, electrical goods and appliances, power generators, telecommunications equipment, motor vehicles and plant and machinery equipment. However, concerns have been expressed over the durability and poor quality of these products, prompting a debate over China's genuine interest in its investments into Zimbabwe.

One local retailer whose business has had to fight stiff competition from cheap Chinese manufactured products said that Chinese companies now have a presence in just about all sectors of the economy, but what is of concern is the quality of their products, which is below standard and this gives us the idea that Chinese companies are bringing backdoor industry manufactured goods to Zimbabwe and making a profit at the same time.

With Zimbabwe's unemployment levels at a high of around 70%, Chinese companies have become the new employers in town. But workers employed by Chinese and Indian businesses complain of ill treatment and poor remuneration with those in retail and construction being the most affected.

Mr Muchapiwa Mazarura secretary general for Zimbabwe Construction and Allied Trades Workers Union said that "Chinese employers should take people seriously. Locals are fired any time there is no labour law practiced in Chinese run projects.