July 2011 Vol 35, Business , Financial and Property Indaba

India's Essar to invest up to $4 bln in Zimbabwe: minister

India's Essar to invest up to $4 bln in Zimbabwe: minister (AFP) – 4 hours ago KWEKWE, Zimbabwe — India's Essar Group plans to invest billions in an iron ore processing plant, Zimbabwe's Industry Minister Welshman Ncube said on Wednesday at ceremony marking the re-opening of a steel company. Set to cost $2-4 billion (1.4 - 2.8 billion euros), the plant will be located in Mwenezi in southern Zimbabwe, and seems to indicate a softenning attitude to foreign investments. "This investment qualifies as an investment of the decade for Zimbabwe," the minister said during a ceremony marking the handover of assets in now defunct Zisco steel to India's Essar in the mining town of Kwekwe in central Zimbabwe. Zimbabwe President Robert Mugabe also attended the ceremony and encouraged "the kind world" to invest in Zimbabwe after years of threatening to banish foreign companies from operating in the crisis-plagued country. "We say, ?come, don't be afraid'," Mugabe said at the ceremony, inviting foreign investors to come to Zimbabwe "as friends not as exploiters". Parastatal Zisco steel was one of Africa's largest iron ore producers before collapsing three years ago at the height of the country's economic crisis. Essar agreed in March to buy the government's 54 percent stake in Zisco for $750 million. The firm re-opened Wednesday under the name New Zimbabwe Steel, which is expected to produce 2.5 million tonnes of steel a year in Kwekwe. The new investment in Mwenezi is India's latest push into African investments, the minister said. India and China are locked in a new scramble for African resources and are at an advantage in countries like Zimbabwe where western investors are reluctant to tread. President Mugabe has threatened to take over foreign mining companies, under new equity laws that compel foreign investors to sell majority stakes to black Zimbabweans. Zimbabwe's economy has shown signs of recovery since Mugabe and long-time rival Morgan Tsvangirai formed a unity government to end bloodshed in the wake of failed presidential elections in 2008. Once decimated by hyperinflation, the economy has stabilised since 2009, when the government abandoned its worthless local currency and allowed trade in US dollars.

KWEKWE, Zimbabwe — India's Essar Group plans to invest billions in an iron ore processing plant, Zimbabwe's Industry Minister Welshman Ncube said on Wednesday at ceremony marking the re-opening of a steel company.

Set to cost $2-4 billion (1.4 - 2.8 billion euros), the plant will be located in Mwenezi in southern Zimbabwe, and seems to indicate a softenning attitude to foreign investments.

"This investment qualifies as an investment of the decade for Zimbabwe," the minister said during a ceremony marking the handover of assets in now defunct Zisco steel to India's Essar in the mining town of Kwekwe in central Zimbabwe.

Zimbabwe President Robert Mugabe also attended the ceremony and encouraged "the kind world" to invest in Zimbabwe after years of threatening to banish foreign companies from operating in the crisis-plagued country.

"We say, ?come, don't be afraid'," Mugabe said at the ceremony, inviting foreign investors to come to Zimbabwe "as friends not as exploiters".

Parastatal Zisco steel was one of Africa's largest iron ore producers before collapsing three years ago at the height of the country's economic crisis.

Essar agreed in March to buy the government's 54 percent stake in Zisco for $750 million.

The firm re-opened Wednesday under the name New Zimbabwe Steel, which is expected to produce 2.5 million tonnes of steel a year in Kwekwe.

The new investment in Mwenezi is India's latest push into African investments, the minister said.

India and China are locked in a new scramble for African resources and are at an advantage in countries like Zimbabwe where western investors are reluctant to tread.

President Mugabe has threatened to take over foreign mining companies, under new equity laws that compel foreign investors to sell majority stakes to black Zimbabweans.

Zimbabwe's economy has shown signs of recovery since Mugabe and long-time rival Morgan Tsvangirai formed a unity government to end bloodshed in the wake of failed presidential elections in 2008.

Once decimated by hyperinflation, the economy has stabilised since 2009, when the government abandoned its worthless local currency and allowed trade in US dollars.