Zambians get rough with China

China’s recent pledge to pump millions of dollars into copper-rich Zambia has turned the spotlight on the quality of jobs and investment offered by the erstwhile investors in the Southern African country.

On his two-day stop in Zambia recently, Chinese President Hu Jintao launched an ‘Economic and Trade Cooperation Zone” to be based in the mineral rich Copperbelt region. The cost of establishing the free trade zone is $800-million.

The Zambian zone is the first of five such zones that are to be established across Africa. It is expected to create 60 000 jobs in Zambia over the next three years in addition to the existing 10 000 jobs that have been created by Chinese investors.

The Chinese leader also promised a massive debt-forgiveness package for Zambia, where Chinese investment has been a controversial issue ever since President Levy Mwanawasa’s pro-market economic policies attracted the resource-hungry economic powerhouse.

However, Zambia’s miners argue that such massive investment plans would have little impact on the ordinary people because of the current poor employment conditions prevailing in most Chinese companies in the country.

‘We are still very much concerned and convinced that this investment will not benefit Zambia as a country, unless there is a serious change in policy direction. Otherwise, China will just exploit Zambia’s raw materials without adding any value to the economy,” said the president of the Mineworkers Union of Zambia, Rayford Mbulu.

Chinese firms, like other foreign investors, enjoy a number of incentives for investing in development-hungry Zambia; among them are gene­rous tax holidays of up to 20 years, a low, 0,6%, mineral royalty tax (the global norm is about 3%) and duty-free imports of equipment and machinery — all benefits that local companies do not enjoy.

‘If this Chinese investment is to really benefit the country, government should first check out the incentives and [tax] exemptions. No matter how much money will come in, for us it will be a fallacy of investment under the current development agreements,” Mbulu said.

Chinese investors in Zambia have also been accused of violating human rights, paying poor salaries to their Zambian employees and disregarding safety measures in their operations.

Critics cite the death of 49 Zambian miners in 2005 in an explosion at Chambishi Mine, the biggest ­Chinese-run mine in Zambia, as confirmation of Chinese businesses’ disregard for safety standards. Last year police shot dead five miners during violent protests over working conditions at the same mine.

‘We still have some of our friends getting as low as 200 000 kwacha [R352] a month, and management does not seem to be planning on increasing our salaries or reviewing our working conditions soon — we thought after Jintao’s visit things would change for better, but everything is just the same,” an employee of Chambishi mine told the M&G.

Emily Sikazwe, executive director of Women for Change, a gender advocacy organisation, said: ‘We expect China to make their investment in our country more meaningful by observing human rights, especially the right to livelihood and dignity.”

In the run-up to the 2006 gene­ral election, Chinese investment became a huge campaign issue, with the main opposition leader, Michael Sata, threatening to chase away what he termed ‘bogus Chinese infesters” — a word play on ‘investors” – and also to recognise Taiwan.

Although Mwanawasa returned to power for his second and final five-year term with a majority win, voters in the capital, Lusaka, and in the Copperbelt — two provinces where the Chinese presence is very strong — favoured Sata, with all urban parliamentary seats going to his Patriotic Front party.

The Zambian government, however, now says it will ensure that new Chinese investment leads to improvements in workers’ conditions and promotes both the economic and social status of Zambians.

‘Several concerns have been raised by various stakeholders about Chinese investors offering poor conditions of service and government will now move in to redress the situation since more Chinese investment is expected in the country,” said Permanent Secretary in the Ministry of Commerce Trade and Industry, Davidson Chilipamushi.