Benefits to Zimbabwe from China’s Eased Import Pro...

Benefits to Zimbabwe from China’s Eased Import Protocols

Monica Cheru in Beijing

China is set to continue its policies that encourage exports for developing countries into its infinite market.

This was revealed by the Chinese premier Li Qiang during his presentation of the report on the work of the government presented to the Third Session of the National People’s Congress this Wednesday, March 5 in Beijing.

https://www.zimbabwenow.co.zw/articles/14060/chinas-economic-strategy-opens-new-trade-and-investment-prospects-for-zimbabwe

1. Increased Agricultural Exports

- China has relaxed import restrictions on Zimbabwean agricultural products, such as citrus fruits, tobacco, and beef.

- In 2022, Zimbabwe exported over $100 million worth of citrus fruits to China, following the signing of a citrus export deal.

- Tobacco exports to China have also surged accounting for over 60% of Zimbabwe’s total tobacco exports.

2. Access to Chinese Markets for Minerals

- Zimbabwe’s mining sector, particularly lithium, has benefited from China’s demand for critical minerals used in electric vehicle batteries.

- In 2023, Zimbabwe exported over $500 million worth of lithium to China, making it one of the top African suppliers of the mineral.

- Chinese companies have also invested heavily in Zimbabwe’s mining sector, easing the export process for minerals like gold, platinum, and diamonds.

- Zimbabwe has expressed concern over the export of raw minerals and plans are underway to introduce a mega lithium processing park.

Zimbabwe-China Trade Balance Over the Past Decade

From a trade deficit with China, with imports exceeding exports, there has been a clear growth and the establishment of balance as Zimbabwe production goes up and Chinese investment in industry creates import substitution avenues:.

Zimbabwe-China trade balance sheet for 2013–2023

Year	Exports	Imports	Trade Balance	Notes
2013	324m	612m	-288m	Tobacco & minerals
2015	400m	800m	-400m	Growth in tobacco and gold
2018	550m	1.2b	-650m	Lithium exports began to rise
2020	600m	1.5b	-900m	COVID-19 medical supplies imports
2022	900m	1.8b	-900m	High machinery, electronics imports
2023	1.1bn	900m	+200m	Lithium, tobacco & citrus exports

Factors Behind the 2023 Trade Surplus

Preferential trade agreements and Chinese investments in Zimbabwe’s mining and agriculture sectors facilitated export growth.

1. Lithium Boom

Zimbabwe is one of the world’s largest lithium producers, and Chinese demand for lithium (used in electric vehicle batteries) drove exports to record levels.

2.Agricultural Exports

Tobacco exports to China remained strong, with China purchasing over 60% of Zimbabwe’s tobacco crop.

Citrus exports also grew significantly after Zimbabwe gained access to the Chinese market.

3. Reduced Imports

Zimbabwe’s imports from China declined in 2023 due to reduced demand. As local capacity utilisation went up. It is crucial to note that Chinese investment in local production of consumer goods like toilet paper, plastic ware, bed linen, detergents, footwear and other items has mean that these are no longer imported from China and other countries, thereby giving the treble benefit of saving foreign currency, local jobs and affordability.