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China lends Zimbabwe $700 mln, seeks protection

China lends Zimbabwe $700 mln, seeks protection
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First Published: Mon, Mar 21 2011. 05 50 PM IST
Updated: Mon, Mar 21 2011. 05 50 PM IST
Harare: China signed nearly $700 million in loan agreements with Zimbabwe on Monday, the biggest package of loans from Beijing to the mineral rich southern African country which is shunned by the west.
At the same time, Chinese Vice Premier Wang Qishan emphasised on a visit to Harare that he hoped Chinese businesses would be protected from Zimbabwe’s plans to increase ownership by black Zimbabweans.
President Robert Mugabe, in power for over three decades, has increasingly sought economic and political support from China after western countries imposed sanctions on his ZANU-PF party, accusing him of human rights abuses and election fraud.
Vice President Joice Mujuru said loans from China’s Export-Import Bank would be used for priority areas such as agriculture, machinery and equipment - nearly half the money would go for that - as well as health and water systems.
Mujuru spoke during a briefing with Wang.
Zimbabwe has large mineral deposits, including the world’s second biggest platinum reserves, which China covets to fuel its booming economy.
A unity government formed by Mugabe and long time rival Prime Minister Morgan Tsvangirai has struggled to secure funding from Western donors who are demanding more political and economic reforms before releasing any money.
Wang’s visit comes at a time when there is tension in Zimbabwe’s unity government over a drive by Mugabe’s ZANU-PF to nationalise mines under a law that requires foreign-owned mines to sell majority shares to black Zimbabweans.
Wang said China supported the company ownership moves but urged the government not to tamper with Chinese investments.
“We hope Zimbabwe will protect the legitimate right of Chinese businesses in the country,” he said.
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First Published: Mon, Mar 21 2011. 05 50 PM IST