China’s Export-Import Bank to lend $1.2bn for upgrade of Zimbabwe’s largest power plant

By bne IntelliNews December 2, 2015

The Export-Import Bank of China will lend $1.2bn for the capacity expansion of Zimbabwe’s biggest thermal power plant Hwange to be carried out by China’s Sinohydro Corp., NewsDay Zimbabwe reported on December 2.

The deal, along with 11 other important agreements, was signed on December 1 as part of the landmark visit of China’s President Xi Jinping together with a delegation of 200 people, to the African country. This is the first visit by a Chinese leader to Zimbabwe since 1996.

Zimbabwe’s President Robert Mugabe is seeking to attract more investments from China to prop up the country’s ailing economy, after having been sanctioned by Europe and the US for more than a decade now. The US, along with many other Western countries, imposed sanctions on Zimbabwe's leadership in 2002 following reports of election rigging and human rights abuses. The government angered also donors with a series of controversial moves, including the election rigging and the confiscation of commercial farms owned by whites.

State-owned Hwange generates between 380MW and 400MW of electricity against its installed capacity of 920MW. Sinohydro will upgrade two generators at the plant, providing for an additional 600MW to flow into the national grid that should alleviate electricity shrtages. Zimbabwe has an installed capacity of 2,200MW, but produces an average of 1,200MW, hurting mines and businesses and causing power cuts lasting up to 18 hours a day, NewsDay observes.

China’s Exim bank will also provide a loan to state-owned telecoms firm TelOne to roll out fibre optic cables, The Herald reported.

Xi is set to visit South Africa on December 2, where he will meet President Jacob Zuma and co-chair the Forum on China-Africa Cooperation in Johannesburg.

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