ZIMBABWE is this week celebrating another round of “mega” deals, this time with the Russians.
From August 25 to 29, President Robert Mugabe embarked on a trip to China where he reportedly signed a hatful of deals that would see the Asian economic giant supporting several infrastructure development projects in Zimbabwe.
The latest deal where Zimbabwe would partner Russian institutions in a platinum mining project worth $3 billion in Darwendale near Harare, has been described as the biggest ever by a foreign investor since independence. At full throttle, the platinum mine would reportedly produce 10 million tonnes of ore and create 8 000 jobs.
The first phase of the mine is expected to start this year to 2017 while the second stage would run between 2018 and 2021 where the investment levels are expected to have reached $4,8 billion.
There is no doubt that this investment came at the right time, when everything seemed not to be going in Zimbabwe’s way.
The international isolation that spanned over a decade had seen investment levels plunging to almost zero as Mugabe’s government increasingly became hostile to the West.
A series of government policy blunders and political decisions based on emotion plunged the economy into the doldrums and many had lost hope that there would be any recovery in the near future. However, Zimbabwe is endowed with rich mineral resources, which makes economic recovery possible.
The discovery of diamonds in the controversial Chiadzwa area re-ignited that hope, but it quickly turned into despair due to brazen corruption and shortcomings in government policies.
Alluvial mining is increasingly becoming difficult in Chiadzwa after companies scooped all the diamonds on the surface without investing in the more expensive conglomerate mining.
As we celebrate, the mega Chinese and Russian deals, it would be useful to reflect on what is happening in Chiadzwa. Ordinary Zimbabweans hardly benefited from the discovery of the mega diamond fields and it would be catastrophic if history repeated itself in Darwendale.
The deals should also not lull us into believing that they are the magic bullet for our economic woes. There is still a long, arduous road to economic recovery.