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Zimbabwe is desperate to revamp its infrastructure after years of low investment into that sector but does not have money to do that using domestic resources. In many cases, development of new infrastructure stopped completely. We also struggled to only maintain it. So since 2000, the government has been working with Chinese multinationals to build new communication, energy and water infrastructure.
However, even in the challenging circumstances, Zimbabwe does not want to be extorted.
We are disturbed by reports that some Chinese are taking advantage of Zimbabwe’s desperation, and trust, to inflate their invoices on some projects.
Some have been exposed for charging as much as 700 percent more than they charge for similar projects in the private sector and in other countries.
For example, Sino-Hydro charged Zesco, Zambia’s power utility government $278 million for the expansion of Kariba North Power Station but the same company charged Zimbabwe $533 million for the expansion of Kariba South Power Station.
Chinese technology multinational, Huawei charged NetOne $55,000 per unit for the Access Microwave under the parastatal’s network upgrading project, but charged Telecel Zimbabwe $7,000 per unit. For Radio Base Stations, Telecel Zimbabwe paid Huawei $20,000 per unit but NetOne was charged $35,000.
“Huawei is trying its best to assist its business partner (NetOne) to succeed,” said Huawei spokesman, Lightman Xei responding to the allegations. “We’re all trying our best to do that. We’re also doing a lot of Social Corporate Responsibility to contribute to the society which we operate in.”
We must say the allegations have not been proved yet, but the facts presented so far, with comparative statistics cited, suggest that our parastatals are paying extortionate prices for what must be cheaper works.
Zimbabwe has great confidence in China, Russia, India and other nations in the east, some of our closest allies outside Sadc since 2000 when Europe and America shut their doors on this country when they imposed illegal sanctions. China and Russia stood by Zimbabwe right up to the UN Security Council when vetoing potentially dangerous draft resolutions from Europe and America.
At business level, China has become the biggest investor in Zimbabwe in recent years. Trade between the two countries was $1.1 billion last year.
But to pay huge amounts of money as cited earlier for what must be cheaper jobs will not take us anywhere. Our parastatals will continue to wallow in debts that they might struggle to pay. Ultimately the operational challenges they seek to overcome using Chinese investment might not be addressed.
It is encouraging that NetOne has suspicions on the Huawei deal and the Minister of Information and Communication Technology, Cde Supa Mandiwanzira has ordered an investigation. Zesa and their parent ministry need to investigate their billion dollar agreements too.
It must be across the board, all deals signed by local parastatals and Chinese firms need to be relooked at. Others involving government entities and other foreign firms, not necessarily Chinese ones, must be evaluated as well.
We are optimistic that if we have the proper details and establish that indeed there was inflation of charges, the Chinese companies would be willing to order revaluations. Multinationals like Sino-Hydro and Huawei will not want their public images to be damaged in this way.
But one important point to highlight is that it is easy for us to criticise the Chinese companies alone for possible theft at such a grand scale, without interrogating the role of our own negotiators in the questionable deals. It is possible that some of them may have approved the suspect deals knowing that they would get secret, personal payments later.
It is strange that only parastatals appear to have been fleeced whereas Telecel and Liquid, a communication infrastructure developer, got good deals. The reputation for corruption that our parastatals have does not help in this regard. Therefore the investigations must be widened.
Also, if local firms were not conned, the price scandal must teach us not to be naive when negotiating. Huawei and Sino-Hydro are undertaking many projects across the world so have immense institutional experience which some of their officials might have used for undue benefit here. We need to open our eyes, and ears when negotiating deals so we don’t lose money unnecessarily.
Investigations are ongoing at NetOne, and we urge Zesa and other parastatals to investigate their agreements too. If it is proved that the Chinese indeed inflated their invoices we will demand redress.
In the meantime, let us wait for the investigations to conclude before we begin to talk too much about our partners and the work they do with us. They are the only willing partners Zimbabwe has, but at the same time, Zimbabwe doesn’t want to pay over the odds.
Online Reporter