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Confusion over loan from China

There was confusion as to whether Zimbabwe had received a loan of US$950 million from China or not just five months after the signing of the inclusive government.

Prime Minister Morgan Tsvangirai claimed that Zimbabwe was not looking West or Looking East.

Tsvangirai said Finance Minister Tendai Biti had been assured of credit lines totalling US$950 million from China while (Tsvangirai) he had been away in the United States and Britain.

Biti denied that Zimbabwe had reached any agreements with China.

Tsvangirai’s spokesman James Maridadi said he could not understand why Biti was insisting that there was no money coming from China.

President Robert Mugabe jumped in thanking China for the money but insisting that the money had nothing to do with the MDC because it had been secured four years earlier.

 

Full cable:

 

Viewing cable 09HARARE557, CHINESE ASSISTANCE TO ZIMBABWE

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs

Reference ID

Created

Released

Classification

Origin

09HARARE557

2009-07-06 10:27

2011-08-30 01:44

UNCLASSIFIED//FOR OFFICIAL USE ONLY

Embassy Harare

VZCZCXRO4105

OO RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN

DE RUEHSB #0557 1871027

ZNR UUUUU ZZH

O 061027Z JUL 09 ZDS

FM AMEMBASSY HARARE

TO RUEHC/SECSTATE WASHDC IMMEDIATE 4693

INFO RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE

RUEHAR/AMEMBASSY ACCRA 2934

RUEHDS/AMEMBASSY ADDIS ABABA 3052

RUEHBJ/AMEMBASSY BEIJING 0098

RUEHRL/AMEMBASSY BERLIN 1481

RUEHBY/AMEMBASSY CANBERRA 2315

RUEHDK/AMEMBASSY DAKAR 2682

RUEHKM/AMEMBASSY KAMPALA 3100

RUEHNR/AMEMBASSY NAIROBI 5543

RUEAIIA/CIA WASHDC

RUZEJAA/JAC MOLESWORTH RAF MOLESWORTH UK

RHMFISS/EUCOM POLAD VAIHINGEN GE

RHEFDIA/DIA WASHDC

RUEHGV/USMISSION GENEVA 2230

RHEHAAA/NSC WASHDC

UNCLAS HARARE 000557

 

C O R R E C T E D COPY – CORRECTING CLASSIFICATION

TO UNCLAS SENSITIVE

 

SENSITIVE

SIPDIS

 

AF/S FOR B.WALCH

DRL FOR N. WILETT

ADDIS ABABA FOR USAU

ADDIS ABABA FOR ACSS

STATE PASS TO USAID FOR J. HARMON AND L. DOBBINS

 

E.O. 12958: N/A

TAGS: PGOV EAID ASEC PHUM CH ZI

SUBJECT: CHINESE ASSISTANCE TO ZIMBABWE

 

——-

SUMMARY

——-

 

1. (U) Over the past couple of weeks, both President Robert

Mugabe and Prime Minister Morgan Tsvangirai have claimed

credit for obtaining $US950 million in lines of credit from

China. There were also reports that Zimbabwe would receive a

$5 billion loan in exchange for platinum mining rights. At a

press conference on July 3, Minister of Finance Tendai Biti

categorically denied both loans. END SUMMARY.

 

2. (U) On June 30, Tsvangirai issued a statement summarizing

his recently-concluded trip to the U.S. and Europe. After

claiming pledges of humanitarian and transitional assistance

of $500 million, he commented that Zimbabwe was not

restricted to a “look west” or “look east” policy and averred

that in his absence Biti had secured lines of credit from

China totaling $950 million. On July 2, the Zimbabwe

Independent reported that Biti had signed a Memorandum of

Understanding with China’s Eximbank for a $5 billion loan in

exchange for platinum rights.

 

3. (U) At a press conference on July 3, Biti denied that

Zimbabwe had reached any agreements with China for loans.

Speaking to The Standard after Biti’s conference,

Tsvangirai’s spokesman, James Maridadi, addressed the alleged

$950 million loan and said it represented pledges; he could

not understand why Biti was insisting there was no money

coming from China.

 

4. (U) The Herald’s banner headline on July 6 was “President

hails China aid.” The lead paragraph read, “President Mugabe

has applauded China for unconditionally extending a US$950

million credit facility to help Zimbabwe’s economic recovery

program and blasted the West for insisting on conditions even

as they render bits and pieces of aid to their agencies under

the guise of assisting the people of Zimbabwe.” The article

quoted Mugabe as saying the loan was the first tranche in a

$5 billion bridging package that had been negotiated four

years ago and it was “nonsense” that the MDC had secured any

loans from China.

 

——-

COMMENT

——-

 

5. (SBU) For years, ZANU-PF has trumpeted assistance from

China–assistance that never materializes. What is

disconcerting is that Tsvangirai, who returned from his

western trip with less concrete assistance than hoped for,

now appears to be playing the same game. The lack of

coordination between Tsvangirai and Biti is also troubling.

The bottom line is that until China can get investment

guarantees–non-existant in the current environment–material

Chinese assistance is extremely unlikely.

DHANANI

(7 VIEWS)

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