China rules out budgetary support for Zimbabwe - Zimbabwe Situation

China rules out budgetary support for Zimbabwe

via China rules out Zim budgetary support – DailyNews Live by John Kachembere and Roadwin Chirara  6 MARCH 2014

China has ruled out budgetary support to Zimbabwe.

Finance minister Patrick Chinamasa, who recently returned empty-handed from Washington after being denied funding by the International Monetary Fund (IMF), has bging for external budgetary support to finance the ambitious Zimbabwe Agenda for Sustainable Socio-Economic Transformation (ZimAsset).

The economic blue-print, launched last year by the Zanu PF-led government, requires $27 billion to be fully implemented.

Running on a meagre budget of $4,2 billion since 2009, Zimbabwe is grappling with funding challenges that are affecting economic recovery following a decade of decline.

Lack of investor confidence and fresh capital injection into the economy have spawned a serious liquidity crunch, forcing many companies to either scale down or close operations.

In an exclusive interview with the Daily News, Chinese ambassador to Zimbabwe Lin Lin said it was not his country’s policy to provide budgetary support to other nations.

“We don’t normally provide budgetary support to other countries but we try to help Zimbabwe in our own way,” he said.

The latest development comes as a slap in the face of President Robert Mugabe and his Zanu PF government which established a “Look East” policy in 2003 aimed at harnessing economic and political support from the emerging Asian giant.

Zimbabwe cannot access external credit lines from international financial institutions such as the World Bank and the IMF after the country was stripped of its voting rights in 2003 and was nearly ejected from the grouping in a rare move for the Washington-based institution in 2006.

The restrictions were imposed after Zimbabwe fell behind in repayments to the Fund.

But in June last year, ahead of fresh elections, IMF said it would work with the country for the first time in more than a decade although ruling out new cash advances.

Lin, however, noted that China will always assist the southern African nation through donations and loans for infrastructure projects.

“In recent years, China has provided our Zimbabwean friends with donations such as food, fertilizer, and machinery worth millions of United States Dollars,” Lin said.

“Moreover, we encourage Chinese financial institutions to provide concessionary and commercial loans to Zimbabwe. As a matter of fact, since 2009, China Exim Bank has approved loans to 6 projects in Zimbabwe, including the construction of the National Defence College, the Harare Water Treatment Project, medical equipment for hospitals in Harare, the Victoria Falls Airport Upgrading project, the NetOne Upgrading Project and the expansion of the Kariba South Hydro Power Station, with a total worth of over $820 million.”

On Tuesday, China donated $500 000 towards the Tokwe-Mukorsi disaster.

In a desperate attempt to lure Chinese investment in the country, Zimbabwe in January this year added the Chinese Yuan to its multiple currency system basket, which include the United States Dollar, South African Rand, Botswana Pula, Indian Rupee, Australian Dollar and the Euro.

 

COMMENTS

WORDPRESS: 11
  • comment-avatar

    The all weather friend. China is currently involved with the new generation nuclear plants. Read for yourself Farai..

    7 October 2013
    Osborne agrees to China investing in UK nuclear plants
    COMMENTS (946)

    George Osborne: “We’re going to make sure of course that the very stringent British rules on safety are applied”

    UK nuclear deal: a good idea?
    Peston: Why Osborne wants China
    Warning of future UK power shortages
    The Chancellor, George Osborne, has announced that the UK will allow Chinese companies to take a stake in British nuclear power plants.

    The announcement also said that Chinese firms might eventually be allowed to take majority stakes in British nuclear plants.

    Mr Osborne made the announcement on the last day of a trade visit to China.

    The first China deal could be as early as next week, with the go ahead for a new £14bn plant at the Hinkley C site.

    Also on Thursday, a report commissioned for the prime minister warned of a growing risk of power shortages over the next few years.

    The Royal Academy of Engineering said the closure of older power plants and the slow progress in building news ones was likely to stretch the system “close to its limits”.

    Supply is expected to come under strain in the winter of 2014-15.

    Most existing coal-fired plants are expected to be closed in 2015 to meet European Union pollution directives, while many gas-fired power plants are not being used at the moment because gas is so expensive.

  • comment-avatar
    Roving Ambassador 4 years

    The Chinese are very shrewd in their business deals. They Will wait until Zanu has totally run out of options then they will get what they want for next to nothing. They know Mugabe is an idiot and he will definately mess up and the wait won’t be long. They did the same trick with Rover and eventually got it for nothing. They will rape the country dry. Very strange Zanu is very Happy to succumb to a rapist.
    The solution is right in front of their nose, open up political space, observe people’s rights. Adhere to the constitution, law and order is paramount and then call for an early election without involving external forces like Likuv and the Chinese.

    • comment-avatar
      Zimbo 4 years

      could not agree more.The Chinese know Mugabe is desperate.They hold all the aces in the pack.It”s just a matter of time and they will get anything they want for next to nothing.We might as well start learning Mandarin.

    • comment-avatar

      Zimbabweans wake up. We have been colonised by China. mugabe rants and raves against British colonial rule. This is a diversion tactic, he hopes we won’t notice that China has replaced Britain as the coloniser

  • comment-avatar
    John Thomas 4 years

    I love this. The look east policy fully exposed. The Chinese have no time for these foolish liberation heroes. They have battled to throw exactly these types out of their own politics. Remember chairman Mao?

  • comment-avatar
    Nyoni 4 years

    Interesting comments. The Canadians amongst others recently stopped certain investments from China into their country. I wonder why.

  • comment-avatar
    Iceman 4 years

    Kkkkkkk with a budget of 4.2 bn your dreaming of a recovery program that costs 27bn and your expecting money from the chinese what are these people smoking

  • comment-avatar

    Chinese never going to fund government, they regard this as a waste as beneficiaries historically do not appreciate this funding, not visible enough and open to too much theft. They will build a stadium or a palace so everyone can see what they have built. Look to Malawi whose civil service is 40-60% funded by EU/UK. population did not see it and only noticed when all the money was stolen and the donors stopped future funding. Now no street lighting, no new schooling and no cash.

  • comment-avatar
    NBS 4 years

    The financial mat is being pulled out from under ZPF. It is called judgement!

  • comment-avatar
    Daniel 4 years

    The chickens are coming home to roost!!!

  • comment-avatar
    DL 4 years

    There goes the money to pay for Mugabe’s promised civil servant wage increase. Remember, Chinamasa said they would have the funds by April? Now it ain’t happening. You’re a pretty sh*tty President when even your closest foreign supporters refuse to give you money because they know they’ll never get it back. Chinamasa, what about all that money that you were going to “unlock,” through indigenization? Or the loans that were to magically gush forth from BRICS? What about those funds that you were going to “avail,” from the diaspora? The non-formal businesses? Where is it? The only source if money for the country is Mugabe’s mysterious “well wishers.” I suspect that those well wishers are actually Mugabe and his fellow thieves in ZANU-PF. They themselves are propping up the country with their stolen money. Let’s make them deplete their bank accounts completely!