Steel plant in Zimbabwe plans to buy Chinese company
The Minister of Zimbabwe Mike Bimha said about possible Chinese investment in the steel industry of the country. According to him, the company R&F Properties from China plans to invest about $ 2 billion in a steel mill ZISCO. Owner of the company is businessman Zhang Li. It is included in the list of the richest Chinese businessmen. The government of Zimbabwe hopes for a favorable outcome of such decisions on investments. According to analysts ' estimates, this amount will help to resume the work of the enterprise. Within 1.5 years the plant will start production about 1 million tonnes of steel a year.
Zimbabwe Iron and Steel Company was built in 60-ies of the last century. Its planned capacity is estimated at 2 million tons of steel per year. The company is the largest in Africa, with the exception of statistics on South Africa. In 2008, the plant went into decline and was forced to close. It happened because of debts, obsolete equipment and lack of competent leadership. In 2011, the company has tried to revive the Indian side. Essar Steel of India has invested in the plant about $ 750 million. However, project implementation was prevented by the conflict with the government. In 2015, the deal is annulled.
Some evidence of the intentions of the Chinese side to acquire the plant. With this outcome of the negotiations ZISCO will be the first public company in the country, sold to a private owner. Starting the plant could be a major breakthrough for Zimbabwe’s economy. It will also help the national railway company to make a profit again. More than half of its income was attributable to the transportation of coal to ZISCO.