A Chinese company, R and F, has informed the government that it was pulling out of a deal to acquire a stake in the Zimbabwe Iron and Steel Company (ZISCO).
The Herald was told by its sources that the government wanted to renegotiate the deal, agreed on under the previous administration. The publication quotes its source as saying:
R and F wrote to the Government advising that it was no longer interested. The parties could not agree after the new dispensation ordered the deal to be re-looked into.
There are several issues the Government was not happy with. It is not like the Government wanted to side line the investor, but wanted a win-win situation.
Under the deal, R and F would have acquired ZISCO’s majority shareholding, thus paving the way for the resuscitation of the iron and steel plant at a cost of US$1 billion.
Reports suggest that there were a number of unfavourable terms in the deal, so much that the deal was literally as good as mortgaging the country to the Chinese company.