China has urged Harare to respect a bilateral investment protection pact and safeguard Chinese investors’ lawful rights.
The ambassador made the appeal as the Zimbabwean government took steps to consolidate foreign diamond mines and pressed ahead with an indigenisation policy requiring foreign companies to cede majority interests to black Zimbabwean partners.
Huang said in a media workshop held in Chinese embassy Friday that the embassy respected the adjustments on economic policies undertaken by the Zimbabwean government and expected Harare to uphold the rule of law in the due process, including adhering to the China-Zimbabwe Bilateral Investment Promotion and Protection Agreement.
The pact, signed by the two governments in 1996, provides that the investment on each other’s territories cannot be nationalized, confiscated, or be affected by any measure that has the similar effect as nationalization. In case of nationalization for the public interests, the process should be done legally and investors should be compensated.
The ambassador referred to the recent shutdown of business operations in Marange diamond fields where two of the Chinese-Zimbabwean joint ventures were operating.
The two, along with four other joint ventures involving investors from South Africa, United Arab Emirates, Russia, and etc, had been ordered by Mines and Mining Development Minister Walter Chidhakwa to join a consolidated diamond mining firm or pack and leave in three months’ time.
Huang said he had raised the issue with several Zimbabwean ministers and the two sides agreed to protect the personal and property rights of the Chinese investors, respect the rule of law, and enhance communication to avoid such business frictions derailing the overall friendly cooperation of the two countries.
“We understand that the move was not targeted at Chinese businesses, but unfortunately two of our joint ventures were affected,” he said.
Huang said the government supported the affected businesses to solve the issue via judiciary means, and would keep following the case to urge the protection of the lawful rights of Chinese investors in Zimbabwe.
As the Western development funds and investments shrank, Chinese companies were invited to invest. For the past few years, China has been Zimbabwe’s top source of foreign investment.
The figure peaked at 600 million U.S. dollars in 2013, according to the Chinese Ministry of Commerce, ranking Zimbabwe as the top attraction for Chinese investment in sub-Saharan Africa that year.
It is estimated that around 100 medium and large Chinese companies have operations in Zimbabwe, not to mention many smaller businesses and individuals active in commerce.
Huang also urged them to adhere to Zimbabwean laws and regulations.