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Zambia reaping ‘One Belt, One Road’ benefits

LAST Thursday, residents of Lusaka West on both sides of the new Mumbwa road found their main access road into the city centre from Cargeal, formerly Zamanita, to the Mumbwa road-Lumumba road traffic lights closed.
They knew why. Avic International, a Chinese construction company, was working on the last stretch of the Mumbwa road expansion project.
Avic is one of the many Chinese companies working on roads and building construction projects countrywide. A number of Chinese businesses have also injected substantial investments into the mining and manufacturing sectors in the last five years.
Their collective investment runs into hundreds of millions of United States dollars. In 2012, the total value of Chinese investments in Zambia increased to over US$2 billion, most of them in the mining sector on the Copperbelt, then Chinese Ambassador to Zambia Zhou Yuxiao disclosed.
Mr Zhou cited agriculture, manufacturing, construction, energy and tourism as the other sectors that had received significant Chinese investments.
There is more good news, though. A group of 30 Chinese companies is set to invest a colossal sum of US$1 billion in a manufacturing hub to be called ‘One Belt and One Road Industrial Park’.
Twenty executives representing the companies visited Zambia last week to look at the sectors of the Zambian economy in which to invest.
The four-day visit and the investment have come at a critical time. This peaceful southern African nation is in the throes of economic challenges – the local currency gasping in the chokehold of a strong dollar, low global copper prices and a crippling energy crisis induced by climate change.
And the world’s second largest economy, China, is transiting through a growth slowdown.
The Zambia Overseas China Association made possible the visit that was extended to the tourist city of Livingstone.
The industrial park, spearheaded by International Physical Distribution Group and the Zhongrum Investment Development Group Corporation Limited (Zambia), is envisaged to stand on a sprawling 700 hectares of land.
It will host over 20 high-tech firms engaged in bicycle and water pump assembling, environmental refuse disposal management, construction, concrete processing, municipal engineering, and petrochemical manufacturing and packaging.
The companies will also be involved in advanced medical materials, illumination, plastic material physical distribution management, packaging, agriculture and tourism.
This unexpected kiss of life for the local economy has elated President Lungu, who happily hosted the Chinese business bigwigs at State House to signify the importance he attached to the mission.
The President called for stronger bilateral relations with China and assured his distinguished guests that Chinese investments in Zambia will remain safe.
President Lungu promised to invite more Chinese investors to visit Zambia and commended the delegation for choosing the country when there are many others in Africa.
He said improved bilateral relations between the two countries will help improve Zambia’s economy.
“Former President Kenneth Kaunda and Chairman Mao [Zedong] were friends and had their time in nurturing the bilateral relations and this is our time now,” President Lungu said.
He urged the Chinese investors to establish solid relations and create partnerships with the people of Zambia during their visit.
Minister of Commerce, Trade and Industry Margaret Mwanakatwe said the Zambian government is providing an enabling environment for business to thrive.
Mrs Mwanakatwe said this during the launch of the One Road and One Belt Industrial Park at Mulungushi International Conference Centre in Lusaka.
The Chinese investors were led by secretary general of the Tianjin Federation of Industry and Commerce Liu Daogang.
Mrs Mwanakatwe said in a speech read for her by Minister of Foreign Affairs Harry Kalaba that Government has put in place both fiscal and non-fiscal incentives in key priority sectors which include mining, manufacturing, tourism, infrastructure development and information communication technology (ICT).
And speaking on behalf of the delegation, Mr Liu said the visit was a follow-up to the agreements the two governments had signed when President Lungu visited China.
He said the trip was meant to strengthen trade relations between Zambia and China, and that there were 30,000 companies in the federation most of which he said he will encourage to visit Zambia to explore business opportunities.
Mr Liu said the Tianjin Federation of Industry is organising a Zambia-China business forum to take place next year and urged Government to set up a team that would specifically provide technical support to Chinese investors.
Zambia Overseas Chinese Association chairman Zhang Jian says the first phase of the US$1 billion investment will gobble US$300 million while the remainder will be invested in the later phases.
Mr Zhang said the huge investment reflects the confidence private Chinese businesses have in Zambia’s economy.
Such investments will help actualise the much touted Africa-China co-operation at national level where its impact should be felt, and give the One Belt and One Road initiative its true meaning.
In 2013, Chinese President Xi Jinping proposed a new strategy for China’s new role in global economic development while visiting Kazakhstan.
The One Belt and One Road initiative encapsulates this new focus that espouses economic development through co-operation, peace and friendship based on mutual respect and benefits.
It is akin to the ancient Maritime Silk Road, a trade route that saw China engaging in trading with other civilisations south of the Indian Ocean and snaked through the mainland Asia and Europe.
The 21st Century Maritime Silk Road, the route of the One Belt and One Road initiative, runs from the ancient-time starting point, the port city of Quanzhou in Fujian Province, cutting through mainland China, central Asia, parts of Europe and Africa, and south of the Indian Ocean.
Under this initiative, China will fund and implement infrastructure development projects in partner countries along the new route to strengthen their capacity to address poverty and achieve economic growth as its contribution to global economic development.
With US$4 trillion in China’s strategic reserves comfortably stashed away in banks, which African country would not want to be on the Silk Road?
The citizens of the two great countries cannot wait to reap the benefits of the One Belt and One Road initiative, and the US$1 billion One Belt and One Road Industrial Park offers a perfect starting point.