Published by the government of Zimbabwe
20 November 2009
Harare — Zimbabwe's economy is set for turnaround following the huge investment package - worth US$8 billion -- unveiled by a Chinese-Angolan joint venture company, China Sonangol.
Reserve Bank of Zimbabwe Governor Dr Gideon Gono on Wednesday said a "significant" amount of this money was already lodged in local financial institutions.
Yesterday Government officials said they could not reveal exactly how much was in the banks and which financial institutions were involved, saying they would first have to discuss the deals further in Cabinet and with President Mugabe.
China Sonangol signed five deals worth US$8 billion that will see investment pouring into various key economic sectors.
Key sectors that would benefit under the deal include mining and housing, among others.
Economists and political analysts described the deal as a welcome initiative.
Mr Johannes Chiminya of the Zimbabwe Economic Society described the deals as a positive move that would ensure liquidity in the economy.
"Our economy is facing serious cash flow challenges and this investment package is a timely boost.
"As a country, we were failing to invest in big projects like mining because our cash budget is not sustainable.
"We hope that this investment package marks a new era of capital investment in the country," said Mr Chiminya.
He said the investment package would create a lot of opportunities since it was targeting key economic sectors like mining, which has the capacity to generate export receipts and spur employment.
Mr Chiminya added: "We hope that China will continue to stand with us as we move forward in reviving our economy."
Economist Mr Frank Chirowa hailed the Chinese for showing confidence in Zimbabwe by making such a huge investment.
He said Zimbabwe would reap positive economic benefits from the deals, which he said would create many jobs.
"This investment deal is going to create employment for many local people and there is no doubt that our economy will thrive.
"It is our anticipation that this investment will generate more money that will keep our economy afloat," Mr Chirowa said.
Legislator and political analyst Professor Jonathan Moyo said the investment would force hostile Western countries to rethink their position on Zimbabwe.
"This investment is not a small investment by any stretch of the imagination. The investment is coming from a country that holds the bulk of the US treasury bills and a mover and shaker of the world economy.
"So it will certainly have tremendous copycats from the Western countries who will obviously feel left out.
"The West knows that Chinese money is real money that can attract more money because it is not political," Prof Moyo said.
The Chinese investment package is the largest single direct foreign investment since the formation of the inclusive Government in February and one of the biggest since independence.
It also confirms the fruition of the Look East Policy adopted by Zimbabwe four years ago.
The package is a culmination of a meeting between President Mugabe and Chinese Premier Wen Jiabao in Egypt at the recent summit of the Forum on China-Africa Co-operation.
Zimbabwe and China's ties date back to the days of the liberation struggle when Beijing provided technical, financial and moral support for the Second Chimurenga.
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