Harare Residents Trust digs into disbursement of Chinese loan

Harare Residents Trust has indicated that it is probing the issue on how the City of Harare ended up entering into the Chinese loan deal.
The trust said 50% of the Chinese Loan has been disbursed so far.

"The Harare Residents Trust continues to dig into how the City of Harare ended up entering into the Chinese Loan deal," said the trust. "The Chinese
approached the Harare Water Department, City of Harare, represented by the contractor, Chinese Machinery and Engineering Cooperation."

The trust said the City of Harare, through the Harare Water Department compiled the works to be done across the whole network.

"The Chinese took the proposal and priced the works, that is the documentthat came to the council, Environment Management Committee, the Finance and Development Committee and the Full Council for approval. This led to the signing of the contract," said the trust. "After the approval, the Town Clerk signed the commercial contract with the Chinese Machinery and Engineering Cooperation (CMEC). There was another document that was produced for the signing. The Government of Zimbabwe and the Chinese Eximbank with the Minister of Finance and Development signing on behalf of the Government, guaranteeing the project."

The trust said the Chinese EximBank then released 50 percent to the contractor, who then started works.

"When the contractors does some work, they submit a claim to Harare Water, then Harare Water passes the claim to the Ministry of Finance for onward transmission to the Chinese EximBank," said the trust. "Once they have received the claim, the Chinese EximBank is supposed to pay 50 percent of the claim. NB: Since the Chinese EximBank deposited 50 percent in 2013, they have not paid any claims from the contractor."

The trust said reports now indicate that the Chinese EximBank is now backtracking given the mounting debts to China by the Zimbabwe Government.