Chinese ‘grab’ construction projects

Stewart Mangoma, M&R Chief Executive, told international investors that his construction firm faced serious and “stiff competition” from China and, sometimes, South Africa.
“South African and Chinese contractors are moving into our industry and taking most of the few projects,” a worried Mangoma said.
“The Chinese have also taken over the telecommunications industry and we face stiff competition because they have cheaper and more skilled labour.
“Most skilled Zimbabweans have left the country and we definitely need long-term funding for the industry to survive. We currently have a very low order book and this is worrying. China is a very significant player in the SADC.”
The construction industry employed about 100 000 people in the 1990s, but in 2011 only 30 000 workers have jobs.
Mangoma said maybe the best way forward for his firm was to join hands with Chinese construction firms, who have been given major projects in the region.
The Chinese, now a major player in Zimbabwe’s economy, built the 60 000-seater National Sports Stadium in Harare, Chitungwiza General Hospital, and Chinhoyi General Hospital.
They also designed and built President Robert Mugabe’s lavish mansion at Kutama Village in Zvimba Communal Lands a few kilometres outside Harare.
“Most of our projects right now are in the mining sector,” Mangoma said. “As far as buildings are concerned, we are facing stiff competition. In the telecommunications sector we are being kept very busy and it is this sector that is keeping us going.”
The Chinese were given “Favoured Nation Status” by the Zanu (PF) government for helping it during the liberation struggle.
The construction industry is a good economic barometer – because it is the first to feel the impact of a recession and is a good indicator of the stage of economic recovery. Minimal construction activity has occurred in Zimbabwe despite the infrastructural decay, due to liquidity constraints and the high cost of local building materials,” says Imara Edwards Securities.
“Estimates indicate that Zimbabwe will require approximately $15 billion in the next five years for infrastructure development. Local pension funds are heavily invested in commercial property. That said, we believe significant growth will come from the residential market as the mortgage market redevelops.”