BEIJING, China – President Emmerson Mnangagwa is currently in China to participate in the Forum on China-Africa Cooperation (FOCAC), a key event that underscores the strategic partnership between China and African nations.
Prior to the forum’s start, Mnangagwa visited the bustling commercial hub of Shenzhen, where he toured leading companies such as Huawei and BYD, both of which have significant business interests in Zimbabwe. The Zimbabwean leader has also met with Chinese President Xi Jinping as the FOCAC event kicked off in Beijing.
Mnangagwa’s visit comes at a critical time as China has recently scaled back its financial commitments in Africa, prompting African leaders to present more viable and bankable projects to maintain the strong economic relationship with their “all-weather friend.”
Zimbabwe-China Trade and Debt Overview
In 2023, trade between Zimbabwe and China reached $3.12 billion. Zimbabwe exported $1.71 billion worth of goods to China, primarily minerals and tobacco while importing $1.41 billion in goods from the Asian giant. Despite this trade volume, Zimbabwe’s trade with China remains smaller compared to some of its regional counterparts, such as Zambia, which conducts over $5 billion in trade with China, largely driven by copper exports.
On the debt front, Zimbabwe owes China $2 billion, with most of these loans directed towards energy projects, including the expansion of the Kariba and Hwange power stations. Although Zimbabwe’s largest debt is to Western creditors in the Paris Club, China is the country’s biggest creditor outside this group, accounting for 95% of Zimbabwe’s non-Paris Club external debt.
Chinese Investment and Major Projects in Zimbabwe
China is the largest foreign investor in Zimbabwe. In 2023, the Zimbabwe Investment Development Agency (ZIDA) issued 369 new licenses to Chinese investors, with planned projects valued at $3.9 billion. These investments are concentrated in mining and manufacturing, with 201 projects in the mining sector alone. However, Zimbabwe’s share of China’s total investment in Africa remains relatively modest, accounting for only 3-5% of Chinese investments on the continent.
Zimbabwe has also benefited from Chinese involvement in key infrastructure projects, although securing large-scale funding has been challenging due to the country’s credit history. Notable projects include the expansion of the Kariba power plant and the construction of new units at the Hwange power station by Sinohydro. Additionally, China has funded the expansion of major airports and telecom networks, although some projects, like the Gwayi-Shangani dam, have faced delays.
Growing Chinese Presence in Zimbabwe’s Resource Sector
Chinese companies have significantly increased their presence in Zimbabwe’s resource sector, particularly in lithium mining. Since 2022, Chinese firms have invested over $1 billion in acquiring lithium mines and constructing processing plants. Notable players include Huayou Cobalt, Sinomine, and Chengxin, all of which have made substantial investments in Zimbabwe’s lithium industry. The Zimbabwean government is encouraging these companies to further invest in value-added processes, such as a proposed “battery park” in Mutorashanga.
Future Prospects and FOCAC Objectives
During his visit, President Mnangagwa is seeking to attract more Chinese investment, particularly in infrastructure and energy. He has engaged with executives from Xin Gang Lian, which is developing a ferrochrome mine and thermal plant, and China Energy Engineering Corporation, which has proposed a 1000MW floating solar plant on Kariba dam. Other discussions have involved major Chinese firms such as Huawei, China Rail, and BYD.
As the FOCAC summit continues, Zimbabwe hopes to leverage its longstanding relationship with China to secure further investments that will drive economic growth and development in the country.