Belarus and Zimbabwe Aim at "Mega Deals"

Viktor Sheiman and Robert Mugabe

Belarus steps up its cooperation with Zimbabwe in sectors ranging from agriculture to mining.

In mid-November, The Herald, a government-owned leading Zimbabwean daily, triumphantly reported the “nod” granted by the country’s President Robert Mugabe to a number of investment deals with Belarus after his meeting with Viktor Sheiman, Lukashenka’s chief property manager.

However, Zimbabwe's failing economy and international isolation, as well as the chequered history of cooperation between the two countries, cast serious doubt on the prospects of these "mega deals”.

Lukashenka’s Grey Eminence Closes “Mega Deals”

Viktor Sheiman arrived in Harare on 15 November as a personal envoy of the Belarusian president. On 18 November, he met the Zimbabwean president Robert Mugabe. Mugabe gave the green light to cooperation between the two countries in delivery of mining and agricultural equipment to Zimbabwe, as well as in agriculture.

Mugabe and Sheiman also discussed cooperation in the field of electricity, construction of roads, houses and bridges, and teaching of Zimbabwean students in Belarus. “We are going to big scale bilateral cooperation and this is very optimistic,” said Sheiman.

In Harare, Viktor Sheiman also signed a joint venture agreement for the extraction of gold and other precious minerals with the Zimbabwean mining minister and the Reserve Bank’s governor.

According to the mining minister, “this agreement seeks to provide a framework for us to access capital equipment and technical know-how from Belarus particularly as it relates to mining on rivers”. It is worth noting that Belarus has not been previously known to have any particular experience in river mining.

The servile Zimbabwean government media has described the recent agreements with Belarus exclusively in terms of “mega deals”, which are supposed to bring prosperity to Zimbabwe. Zimbabwean officials, such as finance minister Patrick Chinamasa and Mugabe’s wife Grace, have been boasting about deliveries of equipment from Belarus at their meetings with businessmen and the local population.

Surprisingly, the Belarusian government-run media, usually overly enthusiastic in their reporting of breakthrough projects with foreign governments, has kept total silence on Sheiman’s trip to Zimbabwe.

Europe's and Africa's “Outposts of Tyranny”

Belarus and Zimbabwe retain many similarities in domestic politics and international standing. Both countries have very high inflation and irremovable presidents who remain in power through oppression of the opposition and rigged elections. Robert Mugabe has been steering his country since 1987 and is now in his sixth term; Alexander Lukashenka has been in power since 1994 and is in his fifth presidential term.

In January 2005, at a Senate Foreign Relations Committee confirmation hearing for the future US Secretary of State, Condoleezza Rice specifically identified Belarus and Zimbabwe (alongside Myanmar, Cuba, Iran and North Korea) as the “outposts of tyranny”. Zimbabwe has always obligingly supported Belarus when the latter has been targeted by critical reports of human rights bodies.

Both countries are currently under the US and EU visa and economic sanctions (though most sanctions against Belarus have recently been suspended). However, Zimbabwe faces less criticism than Belarus from international human rights bodies.

Long History of Dampened Expectations

Belarus and Zimbabwe established diplomatic relations in April 1992. Since 2001, the two countries have begun exchanging visits of governmental delegations, initially at the level of ministers. Vice-presidents of Zimbabwe, John Nkomo and Emmerson Mnangagwa, visited Minsk in 2011 and 2015 respectively.

Over all these years, the two countries’ relationship followed a predictable pattern. Every Zimbabwean delegation, having visited a dozen Belarusian manufacturers, expressed admiration for Belarus’ industrial capabilities and know-how, and showed a great deal of enthusiasm for the prospect of bilateral trade. The Belarusian leader received each such delegation and talked about major contracts and a great future.

However, over this time, these well-publicised trips have had little effect on bilateral trade.

A relative breakthrough happened in 2014 when BelAZ, a Belarusian manufacture of quarry machinery, supplied 17 units of its equipment (dump trucks, loaders and bulldozers) to Hwange Colliery coal mine in Zimbabwe. The machinery was supplied through a vendor financing scheme secured by the regional PTA Bank.

In November 2009, Belarus submitted draft agreements on trade and economic cooperation, as well as on promotion and mutual protection of investments, to the Zimbabwean authorities for consideration. To date, the first and only fully-fledged legal agreement between the two countries remains a memorandum of understanding between the ministries of justice of Belarus and Zimbabwe signed in Minsk on 22 July 2015.

Risky Business with a Failed Partner

Viktor Sheiman’s trip to Harare followed directly after Vice-president Emmerson Mnangagwa’s visit to Minsk in July 2015. The Zimbabwean dignitary then visited a dozen Belarusian manufacturers and met a wide range of personalities, from President Alexander Lukashenka to the Belarusian equivalent of Santa Claus.

At that time, Belarus and Zimbabwe reportedly signed a memorandum to supply $150m worth of agricultural, mining, dam and road construction equipment to the southern African nation.

Alexander Lukashenka, welcoming his Zimbabwean guest, also suggested that they set up a vehicle maintenance centre in Zimbabwe that could establish Belarus’ entry into Africa. Lukashenka sees Zimbabwe as Belarus’ “trade hub in Africa”.

Belarus agreed to finance the supplies of its equipment to Zimbabwe. Signing the agreement with Prime Minister Andrei Kobyakov, Emmerson Mnangagwa pointed out that Zimbabwe’s financial institutions guaranteed the entire volume of financing.

According to the agreed timelines, Zimbabwe will start receiving machinery and equipment in the first quarter of 2016. In particular, MAZ, a Belarusian truck manufacturer, has plans to supply at least 100 trucks with right-hand steering to Zimbabwe.

However, independent media in Zimbabwe has pointed out that previous such “mega deals”, including those which Zimbabwe signed with Russia and China, remain mere statements of intent. Zimbabwe has failed to repay loans provided by China totaling about $1.5bn.

The same fate may await the deals signed this year between Minsk and Harare. Belarus has ventured into a very risky business with a kindred regime notorious for its permanent financial and economic failures.

Another concern about these "mega deals" stems from the kind of personalities involved in their conception and implementation. Emmerson Mnangagwa is Zimbabwe's wealthiest individual who has already faced many allegations of corruption.

Viktor Sheiman usually serves Lukashenka in fostering deals where extreme discretion is required. These factors and the lack of transparency in the financing of these projects cast doubts on the true nature of this cooperation.

Igar Gubarevich is a senior analyst of the Ostrogorski Centre in Minsk. For a number of years he has been working in various diplomatic positions at the Belarusian Foreign Ministry.

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