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ChiNA’S first overseas economic and trade cooperation zone in Africa has celebrated its fifth anniversary. China Nonferrous Metal Mining (Group) Co. ltd.(CNMC),the country’s nonferrous metal giant, held a ceremony in February to mark the occasion of Zambia-China economic and Trade Cooperation Zone’s(ZCCZ) achievement as the zone’s founder and developer.
Cluster effect
The year 1998 was a special one for CNMC. it was the year the company made its first investment in Zambia, and acquired 85 percent of shares of Chambishi Copper Mine through an open bid.
At a time when other investors were hastily packing their bags, leaving local workers stranded, the CNMC’s Vice President Tao Xinghu recalled, the company offered to run the Chambishi Copper Mine and reopened it in 2003 after 13 years of closure, creating employment and helping secure the livelihood of people in the mining area.
Without this bid, there would not have been a Zambia-China trade zone, established in 2007 as the first multi-facility economic zone to get Zambian governmental endorsement.
Zan Baosen, General Manager of ZCCZ, said the construction of the economic cooperation zone was based on win-win cooperation. “The zone can not only help [CNMC] develop a multi-level marketing business, but is uplifting the lives of the local people, and reviving economic prospects in the district,” said Zan.
Since its inception five years ago, the zone has attracted 17 companies and a total investment of nearly$1 billion. ZCCZ has generated almost $500 million in taxes and sales revenues of $4.35 billion, according to data released by CNMC at the zone’s five-year anniversary. it also created 12,000 jobs for Zambia in the past five years.
Since Zambia’s new President Michael Sata took office in 2011, he has stressed that Zambia welcomes CNMC’s investment.
Charles Khamala, a Zambian coal miner, said, “i must say that workers here used to complain about the unemployment [rate], but Chinese investment is creating new jobs now.”local media in Zambia also reported that many Zambians welcomed the economic cooperation with China because any opportunities that open up trade for their country mean increasing the trading opportunities.
Overseas hardships
CNMC is one of the earliest of China’s enterprises in its industry to look for global cooperation.
“Going global is not an easy task for Chinese enterprises and investing overseas is a challenging job,”said Zan. he added that China and Zambia have built a cooperative economic partnership, while enjoying a deep friendship. however even in the best friendships there are challenges.
last October, workers at Zambia’s Chambishi Copper Smelter went on two-week-long strike demanding higher wages. in fact, CNMC increases its workers’salaries in Zambia every year in accordance with its business operations. “We had offered [workers] a pay rise of 12 percent in 2010, and were planning to raise pay in 2011 at the time when the strikes occurred,”said CNMC’s Vice President Tao Xinghu.
CNMC places a great deal of emphasis on the welfare of local employees. When other firms retrenched or closed operations during the financial crisis in 2009, CNMC firms promised “three Nots”: not to reduce investment, not to cut down on production and not to lay off workers, which has made positive contributions to the local economy and social stability. Tao said CNMC remains committed to pursuing such policy.
Tao said that, during the strike, the company promptly contacted the relevant Zambian government ministries and local authorities, and adopted a series of measures to resolve the situation.
President Sata made clear his support for CNMC as soon as he knew the situation, and also dispatched his mines minister to conduct an on-site investigation. The coalmine subsequently resumed production.
President Sata has stressed that ZCCZ is the best symbol of the “all-weather friendship” between the two countries and encouraged China to increase investment in various sectors in the country in the next five years.
Optimistic
Despite the strike, Tao, who has worked in Zambia for nearly 10 years, said that the company is optimistic about its future development in the country. in fact, CNMC has, for more than a decade, been committed to building harmonious labor relations, successfully dealing with the annual labor negotiations many times.
“We believe this is only an isolated incident, and will not affect China’s investment into Zambia, as well as mutually beneficial cooperation between our two countries,” said Tao. CNMC planned to make the significant investment of about $2 billion in Zambia during the 2011-15 period, the equivalent of what it has spent there over the past 12 years.
The investment is not just for production and expanded operations. it will also be used for infrastructure construction and corporate responsibility initiatives, such as building a 3,000-unit housing complex to provide better living conditions for local workers.
So far, the company has put about $130 million into infrastructure construction and has given as much as$10 million in donations and sponsorships in Zambia. it is now the largest Chinese investor in the nation.
CNMC will develop overseas nonferrous metal bases in central and southern Africa over the next five years. “With our advanced smelting technology, it has helped improve Zambia’s copper industry chain and promoted the upgrading of its industrial structure so as to enhance the added value of the country’s copper products,” he added.