eBusiness Weekly
BEIJING – A local agricultural equipment supply firm, Platinum Agriculture, has signed agreements with various Chinese companies for the provision of farming and mining equipment and agro-chemicals to famers and small scale miners in Zimbabwe.
The deals, running into millions of dollars, were sealed ahead of President Emmerson Mnangagwa’s state visit to China and were secured with the technical assistance of government specialists.
In an interview here, the company’s director Dakarai Mapuranga said the deals would be implemented at different time frames based on the varying technical requirements.
“We came at the invitation of ministry of Foreign Affairs and International Trade as part of the private sector contingent, we were also accompanied by technicians and technical people from different ministries in particular the ministry of agriculture which is one of the areas we are working on as Platinum Agriculture,” he said.
“Our mission was to sign off public private sector initiatives that would help Zimbabwe’s economic recovery.”
Mapuranga said the first agreement signed was a $400 million deal with a company called Lovol, which is the biggest Chinese manufacturer of agricultural equipment.
The company produces 100 000 tractors and 50 000 combine harvesters per annum.
“This is a joint venture and commercial loan agreement which will see us as a country getting equipment such as combine harvesters and tractors,” he said.
He said delivery of the agricultural equipment was expected to start in the next three months.
“What we are going to do is once the equipment arrives, it is going to be disbursed through commercial banks this then means, for example, if a farmer wants a piece of equipment they make a lease finance loan application through selected commercial banks and then they do re-payments, some repayments are over three years some are over a five year period.”
The second deal was signed with a company called Dayu for the supply of centre pivots and other irrigation equipment.
The deal is worth $80 million.
“Chinese technicians will be visiting Zimbabwe soon to see the farms and irrigation areas where we need to install, so irrigation will move a little bit slower because there is need for the Chinese suppliers to familiarise themselves with the irrigation projects where the equipment will be deployed.”
“We also signed an agreement with Good Agro of china for a $40 million revolving facility that will allow us to import agro-chemicals on a revolving credit facility basis.
“As you are aware we have struggled to raise foreign currency for payments that are normally required upfront but in this case our Chinese counterparts will give us the goods upfront and when we grow crops we harvest and pay later.”
Meanwhile, Mapuranga said through their recently formed subsidiary, Princewood Enterpises, they had also signed a co-operation agreement with a company called Allen Bus for the supply of 1 500 buses, to help boost the country’s public transport system.
“This facility is a private sector initiative which is in response to government’s call to de-congest the cities so we are going to bring into Zimbabwe 1 500 buses, the first 500 will come in as complete built then the remaining 1000 will come in to be assembled in Zimbabwe. We think that this will help our public mass transportation system,” he said.
“There will be some alterations on the buses but it (the deal) is worth at least $200 million, we have a very bad road network so there are some adjustments that need to be made to the buses so they can operate on our road network, for example the suspension on the buses, we think that in the next six months phase one should see delivery.”
Mapuranga said measures had been put in place to ensure that the equipment and buses were serviceable locally.
“We have had a lot of support from the line ministries that gave us their technical people specifically to make sure that we do not get equipment or machinery that is not appropriate for our Zimbabwean market or conditions.
“There has been a mistake in the past where goods were just imported without being adjusted to our Zimbabwe environment and in some cases we had imported some machinery that had no spare parts, so we have made sure that whoever we get into partnership with builds a service centre in the country, that is what we have negotiated for we do not want to be a dumping ground,” he said. – New Ziana
