China warns Zim over mine grabs

HARARE - A brooding China yesterday warned Zimbabwe to beware after President Robert Mugabe’s government ill-advisedly moved to seize all diamond mining claims in Chiadzwa last week, including those in which Chinese companies have interests.

At the same time, the High Court temporarily chucked police out of Mbada Diamonds’ Chiadzwa operations yesterday, after shareholder Grandwell Holdings — a subsidiary of South African conglomerate, The New Reclammation Group — sought legal recourse over the government’s controversial move.

China, which has been one of the few world powers that have kept their relations with Harare warm over the past 16 years of political and economic turmoil in Zimbabwe, told the Daily News yesterday that Zimbabwe ought to respect property rights in the country.

“We hope that the Zimbabwean side would earnestly safeguard the legitimate rights of the Chinese companies and employees, according to the local laws and the ‘Agreement on the encouragement and reciprocal protection of investments between China and Zimbabwe,” Chinese ambassador to Zimbabwe Huang Ping said in a terse email response to questions.

“The Chinese side is willing to enhance communication and negotiation with the Zimbabwean side, and together create a conducive environment for companies from both sides to conduct mutually-beneficial cooperation,” Ping added.

Analysts canvassed by the Daily News said although the statement was couched in diplomatic language, its message was “clear and hard-hitting” — and amounted to Zimbabwe being “put on notice” by the Asian giant.

In the High Court case, Justice Joseph Mafusire — while postponing Grandwell’s substantive case to tomorrow — ordered police to vacate Mbada’s operations in Chiadzwa, after claims of chaos and massive looting in Marange emerged following Chidakwa’s directive.

“As a contingency plan pending the hearing of this matter on Wednesday, 2 March 2016, as aforesaid or such other day as might be heard, all the fifth respondent’s (Mbada’s) security personnel, with all their chain of command, shall forthwith return to the fifth respondent’s mining site in the Chiadzwa diamond concession.

“And the first, second and fourth respondents (Chidakwa, the Zimbabwe Mining Development Corporation (ZMDC) and the Zimbabwe Consolidated Diamond Company (ZCDC) respectively) shall allow such security personnel full access to the mining site; full access to all the relevant premises thereat, including residential premises; full access to all the equipment, diamond ore, and any other assets belonging to the fifth respondent for the purpose of safeguarding such assets in every manner possible, and the first, second and third (Marange Resources) respondents shall desist from interfering with such personnel,” Mafusire ordered.

Although Chidakwa last week claimed that no diamond mining company had given government any money, Grandwell issued a statement saying Mbada Diamonds had actually released to government about $480 million in the six years they were in operation.

This all came after Chidakwa ordered all diamond mining companies to end their operations, leave their equipment behind and vacate their premises last week, as the government moved to expropriate the operations.

Chidakwa said the government had reached the decision after miners, including Chinese firms Anjin Investments and Jinan, did not agree to the nationalisation of their assets.

Soon after the seizure of the companies, reminiscent of the disastrous land grabs of 15 years ago, hundreds of dealers and illegal panners (makorokoza) invaded the Chiadzwa diamond fields.

Zimbabwe’s decision also set it on a collision course with its key allies China and Russia, who have on numerous occasions indicated their willingness to bail out Harare with much-needed foreign direct investment.

Chinese President Xi Jinping recently visited Zimbabwe and presided over the signing of various agreements to upgrade and rebuild the country’s infrastructure.

At least 10 economic agreements were signed during Jinping’s visit, of which a $1 billion loan to expand Zimbabwe’s largest thermal power plant was the most significant one.

Economic experts said last week that these vaunted multi-billion dollar deals with China were in jeopardy following Harare’s seizure of all diamond mining claims in Chiadzwa.

At the same time, well-placed Zanu PF sources told the Daily News that Chidakwa’s decision was closely linked to the ruling party’s worsening and seemingly unstoppable factional, and succession wars.

“Our Beijing friends, who have walked with us even during our worst times, are understandably very upset with this irrational move.

“They are also saying that this will have dire consequences for the mega-deals that we signed with them last year,” one of the sources said.

Analysts who spoke to the Daily News also agreed that Zimbabwe risked “losing a lot” from the Chinese, following the State’s violation of an 18-year-old bilateral investment promotion and protection agreement (BIPPA) with the Asian giant.

“The Chinese investors will not just sit and watch their investments going under the drain. They are likely to pressure their government to withdraw its support to Zimbabwe,” analyst Francis Mukora said.

Meanwhile, the under-fire Chidakwa and his Home Affairs counterpart, Ignatius Chombo, rushed to Chiadzwa last week, in a desperate bid to douse the flames around Harare’s ill-timed move, and the chaos that followed its move.

Chidakwa came back from Chiadzwa claiming that four panners had been arrested but police later said that 50 illegal miners had infact been arrested leaving observers wondering why the minister was underpaying the numbers.

At the same time, a number of foreign companies operating in Chiadzwa have said that they are considering instituting legal proceedings to enforce their rights in a development, which analysts say has further dented Zimbabwe’s battered international image.

The Russian Embassy — representing one of its companies, which operates a diamond venture in Chimanimani — said it had “no comment at the moment”, although it is believed that they were also taken aback by the government’s move.

Comments (29)

At least China has the courage to stand up to Mugabe. Well done China, we are right behind you. Mugabe needs to learn how to honor agreements but especially with close friends.

White Colonial Boy - 1 March 2016

tichasara nani manje

chidzwa - 1 March 2016

Where are we going to look now - north and south

chidzwa - 1 March 2016

Varume vakuru vavekufongorera museve zvino. Dyuu nokumudhidhi, Kkkkkkkkkkkkkkk

Madhebhura - 1 March 2016

Varume vakuru vavekufongorera museve zvino. Dyuu nokumudhidhi, Kkkkkkkkkkkkkkk

Madhebhura - 1 March 2016

there you are the Chinese. you helped this rag-tag zanu regime to rig elections now they are rigging your interests. zvakatanga nemi mazhingzhong!!!

josphat mugadzaweta - 1 March 2016

I sincerely hope that we do not damage our relationship with China, the only true friend we have had all these years and going right back to the very beginning? At the same time I also wonder just how much of the diamond revenue ends up in our Government coffers; an answer that remains so obscure, some claim nothing which is also not a good thing? If anyone is to blame it is none other than our President, the one person in charge of this country and all its resources? He has messed up this country so badly that there is now no quick remedy to fix it. No doubt and in typical fashion he will blame the sanctions, the former colonials, anything white and the drought, never ever himself. As his cousin the late James Chikerema once said: as academically talented as he might be, the man is a deeply complex person who is inclined to suffer huge mood swings almost as if he is bipolar.

Phukit - 1 March 2016

Chinese companies got they have been operating like a the cabal mafia. They do not create any real jobs in our country . Why do you think Chinamasa is now looking west?. All those companies were under declaring production figure avoiding royalties , vat and C Tax. Biti once said he was getting nothing from Marange. What is 480 million after mining for more than 10 years. There is a report that pointed out that more than 2 billion was in accounted for in diamonds . China should not hold us responsible for what is happening. Instead they should encourage transparency and good corporate governance to their companies operating in Africa. Chidhakwa is just doing something that should have been done along time ago.

Stalkers - 1 March 2016

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prof ashaf - 1 March 2016

That Chiyadzwa claim originally belonged to (Dee Beers) Anglo American Corp. Anglo American pointed out that there is a lot of alluvial diamonds and good rich pipes need to be established for long term mining infrastructure installation. Obviously Anglo American do not pay bribes. They are too straight. Our Zanu PF government booted Anglo American because our government prefers chaos to allow pilferage. Had Anglo American operated those sites, our economy would have totally changed. Somewhere somewhere somebody high up did not get his bags of diamonds under the table, hence the closure. More chaos is to ensue. Watch this space.

Mbareboy - 1 March 2016

Was this expropriation or nationalisation thought thru by the GOZ? This move has major implications on rule of law and respect for property rights in Zimbabwe at a time govt is trying to mend relationships with foreign investors and creditors. No country , not even China, will invest in a country where its existing investments are being expropriated and existing agreements are being shredded to pieces. This kneejeck reaction will be counter productive to foreign investment in the medium to long term.

Dube - 1 March 2016

Ngatiregei kuita madecsions anenge aitwa nechidhakwa (no pun intended) kana kuti mhunhu ane bhabharasi. What message are we sending to investors both local and foreign? That the Government can just wake up any day and dispossess people of their property?

Emmanuel - 1 March 2016

Truthful times are real. When elephants fight it is the grass that suffers. One needs to know that though that be the case the elephants get bruises

Liberty Shungu - 2 March 2016

SHE Kunogadzirisa Matambudziko yose Mashiripiti muhari PFUMA nokuverenga DZOSE Fortune dzako ZVAANOKUUDZAI ZVOSE MATAMBUDZIKO DZAKO TAURA HER DZIRI. + 27735333936 kero ye email healingsonly@gmail.com makore wandei kusafara muwanano yangu kwakaita kuti kusurukirwa, chinoenderera achidanidzira uye kutambura, pashure kunzwa pamusoro amai, i akafunga "nokuda Rand 350 chete, marita matatu mukaka uye matombo maduku yakaenzana zera rangu, iye verenga pfuma yangu zvakarurama uye akandiudza pamusoro yakapfuura upenyu hwangu, hwangu muchato uye mabhizimisi uye mundiro mukaka zvemashiripiti matombo akandiratidza zviso vavengi vangu uyewo womurume wangu girlfriend.She akaita munamato chaiwo uye akandipa simba Indian crystals, mafuta, tsvimbo uye rin'i kushandisa kubasa nzvimbo yangu, bhizimisi uyewo musha wangu .In asingasviki 1 vhiki, matambudziko angu ose vaiva pamusoro uye I`m kufara chaizvo muwanano yangu uye murume wangu akasiya ake shamwari musikana uye akadzokera me.Over makore, ndakasvirwa vakaedza varapi zhinji asi vose failed.MAMA, inokosha mashiripiti chikwama chako chikomborero kwakavandudza dzemari wangu, mabhizimisi kudzikama, rudo uyewo home.The wangu mashiripiti RING yamakapa murume wangu kupfeka apo panguva panzvimbo basa kwaitsigirwa wokupedzisira week.There hakuna imwe nzira mazvita asi kuudza vamwe pamusoro iwe basa ashanyirwe:! + 27735333936.Email ari healingsonly@gmail.com

prof ashaf - 2 March 2016

in addition to $480m mbada has released to govt it has also built the mining enineering department at the university of zim , bought a bus, printers computers etc for the dept. And remember the mbada diamond cup.

r munemo - 2 March 2016

There are many things that the Chinese agreed to do, like the amount of money to be invested over what period, the exploration to be done and etc. Most towns in Zimbabwe developed as mining towns, which is testimony to the fact that, if done well, mining can make a clear difference where it takes place in terms of infrastructure, standards of living and so forth. What have these Chinese done...not even exploration, that's why they wake up one day and see that alluvial deposits are depleting. China should also keep its end of the deal. And they have been operating without licences...they thought they can just do what they want in Zimbabwe - No! So consolidation is the way...a model tested in many countries mining diamonds - it works.

Shanga - 2 March 2016

In the words of the not so great Julius Malema "Africa cannot remain the focus of Super powers, just there to be conqured and exploited." Wake up my fellow Zimbos, musabatwe kumeso with the small things they have done they build towns for us and yet they take enough money to build countries. Its our diamonds you and me must benefit from them more than anyone else.

Senex - 2 March 2016

we should have enough electricity;clean water and smooth tared roads and health services.

michael chikumbo - 2 March 2016

RULE OF LAW IS SACROSANCT AND PRETENDING THAT YOU ARE FRIENDS IN BUSINESS DEAL WITHOUT THE LAW IS FOLLY. THE CHINESE ARE SIMPLY GETTING A TREAT OF THEIR MEDICINE. REMEMBER THEY ONCE SHIPPED ARMS TO KILL ZIMBABWEANS IN 2008 AND GOT THE DIAMOND FIELDS THROUGH BUDDIE BUDDIE RELATIONS. TRANSPARENCY IS KEY. EVEN IN CHINA THEY HAVE SOME SEMBLANCE OF LAW.....EVEN ANY LAW IS BETTER THAN NO LAW....LAWLESSNESS!

J MOYO - 2 March 2016

RULE OF LAW IS SACROSANCT AND PRETENDING THAT YOU ARE FRIENDS IN BUSINESS DEAL WITHOUT THE LAW IS FOLLY. THE CHINESE ARE SIMPLY GETTING A TREAT OF THEIR MEDICINE. REMEMBER THEY ONCE SHIPPED ARMS TO KILL ZIMBABWEANS IN 2008 AND GOT THE DIAMOND FIELDS THROUGH BUDDIE BUDDIE RELATIONS. TRANSPARENCY IS KEY. EVEN IN CHINA THEY HAVE SOME SEMBLANCE OF LAW.....EVEN ANY LAW IS BETTER THAN NO LAW....LAWLESSNESS!

J MOYO - 2 March 2016

kkkk zvobonyana ka zvino ruku yisti iya yo gwarirwa pazhe

mukanya - 3 March 2016

Mining is for the long haul.As Shanga has pointed out,most towns in the country have mining as the nucleus.This then begs the question,how the likes of Chidakwa expect a mine to flourish og it can just be closed down arbitratily like thay?What is wrong with re-negotiating a better way of doing things?? Madness!

Rawboy - 3 March 2016

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