Chinese financial institutions have reportedly put on hold the funding of three big infrastructural projects totalling US$1,324 billion after the Zimbabwean government raided funds from an escrow account for the Robert Mugabe International Airport expansion project.
According to The Independent, US$10 million was diverted from the account, leaving the Chinese “shocked” with the move and losing trust in Harare authorities. An official told the publication:
Basically what happened is that the RBZ raided the escrow account for the Airport project and that move destroyed confidence and trust. There have been negotiations for the money to be returned but the government is not being honourable enough.
The Chinese were patient, but this happened at the beginning of the year and they have now run out of patience. Chinese financial institutions have taken the decision to cease funding the three projects.
The affected infrastructural projects are the US$1,1 billion Hwange 7 and 8 refurbishment, US$153 million Robert Mugabe International Airport expansion and the US$71 million NetOne expansion project.
The government of Zimbabwe has vested interests in all the three projects which are considered critical and are at various stages of implementation.