No joy on extolled China mega deals

Source: No joy on extolled China mega deals – DailyNews Live January 13, 2017

Mugove Tafirenyika

HARARE – Analysts say Zimbabwe is a long way from tying down and reaping
the benefits of its much-vaunted multi-billion dollar “mega deals” with
China, which first hit the headlines in 2014.

This is despite President Robert Mugabe’s recent visit to Beijing, which
saw both Zanu PF apparatchiks and State media using megaphones to suggest
that the deals were about to be consummated, two years after the visit to
Harare by Chinese President Xi Jinping where he signed several memorandum
of understandings (MOUs), amid hopes that Beijing would rescue Zimbabwe’s
dying economy.

But both economic and political analysts who spoke to the Daily News
yesterday said the so-called mega deals would remain a pipe dream as long
as there were no reforms in the country, including clarity on Mugabe’s

Professor of World Politics at the University of London’s School of
Oriental & African Studies, Steven Chan, said China was also keen on
seeing Harare coming out with clear and workable economic policies.

“No-one, not even the Chinese, will ride to Zimbabwe’s rescue until Zanu
PF  bites the bullet and cleans up the economy in a transparent and, above
all, technocratic manner. Politics has nothing to do with it. Fiscal
probity and stability have everything to do with it.

“The Chinese work with as much data as the Reserve Bank of Zimbabwe.
Insofar as Chinese banks might be involved in financing investments, they
need to behave like banks anywhere, as they are not charities.

“China is right now in no rush to throw good money into a bad situation.
What will probably happen is that, to allow face to be saved all round,
there will be some modest release of funds and drip-feed to selected
projects,” Chan said.

Xi paid a state visit to Zimbabwe in December 2015, before attending a
summit of the Forum on China-Africa Co-operation in Johannesburg, where he
promised multi-billion dollar investments for the African continent.

During his meeting with Mugabe earlier this week, Chinese State media
reported that Xi merely said China was willing to encourage capable
companies to invest in Zimbabwe and expand mutually beneficial

Economist John Robertson said China was “so business-minded” that it was
only prepared to invest in sound projects, adding that the Asian economic
giant was also worried about Zimbabwe’s investment laws that did not
protect investors.

“China has repeated its willingness to invest in any good projects,
nothing more. Good projects will be secured by a clear commitment that
protect investor rights, and Zimbabwe keeps forgetting these promises and
so trust has to be rebuilt,” Robertson said.

Political analyst Maxwell Saungweme said the consummation of the mega
deals was being hampered by the country’s poor governance culture that had
been entrenched by Mugabe over the years.

“To better our economic prospects and be attractive to investors,
including China, we have to improve our ease of doing business by
improving governance, ridding our systems of corruption and reducing
political risk,” he said.

Mugabe and Zanu PF have often described China as the country’s
“all-weather friend” in the face of vilification by Western nations on
allegations of rights abuses and their failure to respect the rule of law,
among various other vices.

Last year, Mugabe described Xi as a “true and dear friend” of Zimbabwe, as
the country sought to deepen its Look East policy, to boost investment and
economic co-operation between the two countries.

Mugabe, who turns 93 next month, is facing the biggest challenge to his
36-year rule as the country’s once vibrant economy continues to die.

He is also struggling to unite his deeply-divided party, amid growing
civil unrest which has re-energised the fragmented opposition.