What’s new: Chinese stainless steel and nickel giant Tsingshan Holding Group Co. agreed with the government of Zimbabwe to expand its investment in steel and coke capacity and start cement and lithium mining and processing in the southern African country, Tsingshan said Friday.
Zimbabwe President Emmerson Mnangagwa and Tsingshan’s founder and Chairman Xiang Guangda oversaw the signing of the agreement Tuesday in Harare.
Tsingshan is building a $1 billion stainless steel plant in Zimbabwe. It will increase its steel capacity to 5 million tons a year from 2 million tons, becoming the biggest steel plant in Africa once the first phrase of the project starts operation next year, according to the agreement.
Tsingshan will increase its coke production capacity in the country to 5 million tons a year. The company didn't say how much capacity it previously planned for the operations. Tsingshan also didn’t disclose the amount of the increase or the size of the projected investment.
In addition, the Chinese company will build a cement production line with annual capacity of 1 million tons and a lithium fine powder processing plant with annual capacity of 2 million tons.
The background: Zimbabwe is estimated to hold Africa’s largest lithium reserves, but due to a lack of investment, most of it has remained relatively underdeveloped.
Zimbabwe has become a foothold for Chinese investment in Africa, in part because it allows foreign investors to set up wholly owned local subsidiaries rather than joint ventures with local companies, a senior executive of a Chinese company with local mining investments told Caixin.
Chinese investments in Zimbabwe have now reached as much as $10 billion, according to the Chamber of Chinese Enterprises in Zimbabwe.
Since 2021, four publicly traded Chinese mining companies — Huayou Cobalt Co. Ltd. (603799.SH), Sinomine Resource Group (002738.SZ), Shenzhen Chengxin Lithium Group (002240.SZ) and Sichuan Yahua Industrial Group (002497.SZ) — have invested in lithium mining in Zimbabwe.
Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bob.simison@caixin.com)
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