Anhui Foreign Economic Construction Group (Afecc), the company that invested at the Chiadzwa diamond fields through its subsidiary, Anjin, has claimed it incurred heavy losses on its investment despite unverified allegations from local people that they were among foreign firms which plundered the country’s gemstones.
BY DESMOND CHINGARANDE recently in Hefei city, Anhui Province, China
Speaking to NewsDay last week, Afecc vice-president Tian ShiYue said despite the negative reports, the project was a complete failure because they did not get a return on what they invested.
ShiYue said every company that invests in a foreign country wanted a return, but in Zimbabwe their two diamond mines were closed down resulting in them making losses.
Anjin and Jinan had a joint venture with the Zimbabwe Defence Forces and were closed for not remitting taxes.
“Every country that invests in a foreign land wants a return, but in Zimbabwe on two diamond mine projects we have not received a return on what we invested,” ShiYue said.
Former President Robert Mugabe once claimed that some corrupt politicians, in connivance with the Chinese and other investors, looted diamond worth US$15 billion from Chiadzwa, leaving the country broke.
“We have not received much from the diamond industry at all. Not much by way of earnings. I don’t think we have exceeded $2 billion or so and yet we think that well over 15 or more billion (United States) dollars have been earned in that area,” Mugabe said during his birthday interview in 2016.
“So where have our carats been going? The gems? You see, there has been quite a lot of secrecy in handling them and we have been blinded ourselves. That means our people who we expected to be our eyes and ears have not been able to see or hear what was going on and lots of swindling, smuggling has taken place and the companies that have been mining have virtually, I want to say, robbed us of our wealth.”
He added: “That is why we have decided that this area should be a monopoly area and only the State should be able to do the mining in that area.”
This led to the closure of all private mines in the area by Mugabe, but ShiYue said there was nothing like that, insisting the closure breached the investment protection pact between China and Zimbabwe. She said they were hopeful of resuming operations at the projects under President Emmerson Mnangagwa’s new dispensation.
“The closure of the mine had already breached the China-Zimbabwe business investment protection. We do not want to lose when the government changes policies like what the current Minister of Finance (Mthuli Ncube) did,” ShiYue said.
The Afecc vice-president said although they were given a go-ahead by the Mnangagwa administration to proceed with the diamond project, the economic situation in Zimbabwe was not good at the moment.
“The economic environment is not good in Zimbabwe at the moment. Our diamond project was closed and we made a loss, we now need new resources to invest and we hope the new government attracts investment. But even if we invest today and the profits cannot go to China, then you have to forget that we will invest soon,” ShiYue further said.
“The other issue is investors want a stable currency and tax regime. We do not want a situation where taxes will be changed mid stream before we have even recouped our investment. This prevailing economic climate is a challenge. The perception that we looted anything is unfounded at all.”
ShiYue told NewsDay that before they were booted out of Chiadzwa, they had built more than 427 houses for the displaced villagers.
Afecc has projects in more than 20 countries that include Madagascar and Mozambique, among others.