Pan African Society: Zimbabwe localization to China on an important lesson | localization | Zimbabwe | Africa

  Sina Wall Street Beijing 28 hearing Zimbabwe is still looking for ways to implement the localization of their controversial legal – assets of more than $ 500,000 of foreign companies must sell 51% stake in Zimbabwe or transfer to local blacks, or else it must be closed。
  Pan African Society published an article that, although unannounced April 1 has passed the bottom line, but that as early as 2008 had been passed, the bill repeatedly frustrated and did not disappear from the list of important government in Harare, will certainly It will be put on the agenda again。
  China is Zimbabwe's main source of foreign investment, China's interests will inevitably be affected。
Although the Chinese people do not want to cause localization is mainly directed against China's perception, but also clearly expressed their dissatisfaction, particularly in the interests of the diamond industry has suffered。
China, people have questioned the reliability of friendship between the two countries, we are confused about the future of bilateral relations。   Over the years China has been the largest foreign investor in Zimbabwe, foreign direct investment in the year 2013 more than $ 600 million。 Chinese investment to countries in Africa, Zimbabwe over the past three years has been in the top three。 There are currently over 10,000 Chinese people living and working in Zimbabwe。
Chinese companies with operations in the field of telecommunications, irrigation, electricity and construction。   Many Zimbabweans also criticized localization, noting that it would undermine the government's reputation, undermine the confidence of foreign investors。 There are views that the local people basically do not have money to buy a 51% stake in foreign-funded enterprises, the so-called localization in fact the government to find ways to plunder foreign conspiracy for the benefit of the privileged group。
Another explanation is that commodity prices are low, Zimbabwe experienced severe economic difficulties, induce Harare authorities to strengthen control over the country。
A former economic adviser to China in Zimbabwe pointed out that the localization of the source, in fact, can be traced back to the revolutionary tradition and the ruling party's political principles。
  Many China watchers will localize called for a new round of foreign capital, "wealth redistribution"。 The last round took place in 2000, Mugabe and his African National Union – Patriotic Front (ZANU-PF) heist white-owned farms, and give to landless blacks。
Later, the government had a serious setback in agricultural production, the former breadbasket of Africa become food before the tense reality to admit, that campaign was a disaster。   People are naturally produced for the Chinese localization is perception, but Beijing is very urgently wants to change that impression。
Many Chinese analysts explain that the damage to Chinese investors may not seem so serious – some of the Chinese mining enterprises, particularly joint ventures, has 51% of the shares belong to the locals; other Chinese mining companies have also submitted their localization plan, will not be forced to close; there are very few companies such as tobacco Chak, due to the huge contribution to the local economy is free from localization。
  However, the argument can not easily hide the true impact of local Chinese enterprises suffered。
Those operating in Zimbabwe for many years of small retail businesses are particularly vulnerable position。
Many of them have had to come up with some creative ways to deal with the past, while revenue minus the violence is real。
  China's investment in the most damaged diamond mine。
In 2012, two Chinese companies Tianjin and Jinan Ann entered the Marange mining area, and they already have 51% of the shares of indigenous people。
However, the Government of Zimbabwe in February or their forced evictions, forcing them to agree to be part of Zimbabwe's unity Diamonds (ZCDC) of。
ZCDC established in 2015, is head for control of the diamond mines of wealth puppet Harare。
An appeal has been Jin Zimbabwe Supreme Court to try to stop the government's decision。   Interestingly, the Chinese try to impact on the localization of understatement, but to the detriment of their interests are also outspoken。
They are not satisfied on the diamond issue last week by the Deputy Foreign Minister to convey directly to the Zimbabwean diplomat。
Chinese Ambassador to Zimbabwe many times through media interviews and public statements of protest, urged Zimbabwe to comply with encouragement and reciprocal protection of investment agreement signed between the two countries。   Regardless of whether the localization for the Chinese, this policy gave quality Nakatsu friendship, sincere degree and future are marked with a huge question mark。
Mugabe is regarded as "an old friend of the Chinese people", and China in order to maintain relations under the original capital。
In 2008, China even rejected the case because Zimbabwe sanctions harm domestic human rights proposed。
President Mugabe and President Xi 2014 and mid-2015 were visits – this is rare gesture of political solidarity。 During the visits, the two sides reached a number of key economic agreement。   The dispute has not been the end result, but discontent is brewing in Chinese folk。 Senior African experts Chinese Academy of Social Sciences Wenping commented that "the agreement reached during the year to invest now is not, and can not withdraw upfront investment, future profits will be smaller."。
Most Chinese believe that public discussion in Harare Banded, angry。
  April 1 deadline has passed almost a month, the Government of Zimbabwe in the end will be how to deal with recalcitrant foreign-funded enterprises are still to be seen。
Some Chinese companies will pin their hopes on the government's flexibility in Zimbabwe kindness, or carry out among。 However, as long as the Harare localization target unchanged, Chinese enterprises suffer, only time and the scale of the problem。
  After all, the face of the current troubles, China can not just blame Harare。
Zimbabwe is actually a re-localization explain the lack of the necessary preparations for the political risk of China's foreign investment, they learn about the considerations of doing business among underdeveloped, poor investment climate dictatorship。
Beijing will continue to face this difficulty – on the one hand they want to strengthen an important political and economic ties between Africa and the role of local hand, we must find a way to deal with foreign policy and the country's high-risk environment。 When accompanied by China vigorously take forward the development and infrastructure projects under way in the area of Africa, such challenges will emerge more。 (Zijin)。

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