In rare public stance, Zimbabwe warns errant Chinese investors

Zawya

21-07-2025

​Zimbabwe has warned Chinese investors against disregarding local labour and environmental laws as well as driving illicit financial activities, an unusual stance after months of public complaints.
Harare's rebuke now upends Zimbabwe's record as one of the African countries that have been most receptive to investment from Beijing, often looking away when issues are raised.
China had, over the years, grown to be the dominant source market for investors into Zimbabwe following the Southern African country's isolation by the West over two decades ago.
Tafadzwa Muguti, a senior official in President Emmerson Mnangagwa's office, this week took by surprise delegates at a conference to discuss Chinese investments in Harare, when he warned investors from the Asian country to desist from 'illicit financial activities, environmental harm and disregard for local laws.''The majority of you (Chinese) businesspeople are not banking (money),' Mr Muguti told the China-Zimbabwe Business Forum on Wednesday.'You do not have bank accounts. You are keeping money under your mattresses, under the floor, or on the roof, but in China you don't do that. If they all take US dollars and Zimbabwe Gold currency and keep them in their houses, it causes our economy to collapse. There will be no liquidity in the market. So starting from now, we are directing you to bank your money.'
Chinese President Xi Jinping, in 2015, designated Zimbabwe as an 'all-weather friend,' a title only given to 14 countries worldwide. The Chinese have heavily invested in Zimbabwe's energy, construction, agriculture, and mining sectors.
China has also financed and undertaken large infrastructure projects such as power stations, airports, roads, and hospitals, but the growing influence of the world's second largest economy in the world has been polarising Zimbabwe.
Critics have long raised concerns about Chinese investors' alleged disregard for local labour and environmental laws, but Harare has frequently defended them.
The government has in the past accused those who are critical of the conduct of Chinese investors of being agents of the West, trying to disrupt the flow of investment from a reliable ally.
Zimbabwe has battled a currency crisis for nearly two decades that saw the country abandon the local unit in 2009 in favour of a basket of currencies dominated by the US dollar.
The country has since then made six attempts to revive the Zimbabwe dollar with the latest attempt being the mineral-based Zimbabwe Gold currency introduced a year ago.
Most businesspeople, especially foreigners, are hesitant to use local banks because of uncertainties surrounding the country's monetary policies and the challenges associated with repatriating their profits from Zimbabwe.
He said there were also growing concerns about Chinese nationals that were violating Zimbabwe's immigration laws by entering the country on tourist visas when they had travelled for job opportunities.'It is not difficult for Chinese nationals to get investment permits in Zimbabwe,' Mr Muguti said. 'Why are you coming illegally? Let's follow the protocols. There is no need to bribe anyone and there is no need to hide. Let's do things properly.'The top government official did not have kind words for investors violating the country's environmental laws and desecrating graves of locals in mining areas.
Chinese companies have been caught mining in Zimbabwe's game reserves after obtaining licences in unclear circumstances while others are involved in riverbed mining, leading to massive destruction of the water courses.
There are also several cases of Chinese mining companies that are locked in conflicts with local communities after being accused of invading ancestral lands and desecrating graves.'We are noticing that some Chinese companies are digging up our ancestors' graves to extract granite or gold,' Mr Muguti said. 'Some of them are picking the bones and putting them aside to start digging. That's the greatest disrespect to any person, even in your culture. So, if we are not patient with one another, then we can't work together.'Steve Zhao, CEO of China-Zimbabwe Exchange Centre, which represents the interests of Chinese nationals, said most of the problems were caused by bureaucratic bottlenecks.'Chinese companies are facing a lot of trouble,' Mr Zhao said. 'After investing huge amounts like $5 million or $10 million, they are facing challenges. Some get Zimbabwe Investment and Development Agency certificates but can't get work permits. Machinery is sitting idle because it can't operate. They end up doing something illegal, not because they want to, but because the system delays.'He said some of the conflicts between Chinese nationals and locals were caused by cultural differences and lack of understanding of the local labour laws.'There are a lot of new people coming in,' Mr Zhao added. 'They don't understand the local culture. They don't understand labour laws. That's why we are hosting workshops with banks and labour agents.'Zimbabwe and China have longstanding ties that developed during the southern African country's 1970s struggle for independence, but the relationship deepened in the early 2000s when the Asian giant started providing substantial aid and investment..
Over the past few years, there has been a steady stream of Chinese settling in Zimbabwe, lured by the widespread use of the US dollar and the strong ties between the two countries. But there are growing tensions between the locals and Chinese nationals due to alleged widespread violations of labour rights and clashes over land, especially in mining areas. © Copyright 2022 Nation Media Group. All Rights Reserved. Provided by SyndiGate Media Inc. (Syndigate.info).
Kitsepile Nyathi