Chinese steel plant: Zimbabwe's economic boon or environmental nightmare?

Zimbabwe is aiming to be home to Africa’s largest steel plant, but disputes over the project continue even as it ramps up production.

Over the past few months, villagers have been accusing the Chinese steel plant’s subsidiary Dinson Iron and Steel Company, or DISCO, of taking over their land without compensation, damaging the environment and not helping them relocate.

There are also concerns that the project, along with the impact of the climate crisis, is impacting food security for villagers who live in areas near the plant.

Chokutaura Chananda, 81, head of Mushenjere, a village in central Zimbabwe, told VOA that villagers are asking all stakeholders for help. They are also urging the Chinese steel company to honor its promises of compensation and relocation.

"We are appealing to all parties involved to intervene, to come together and support our cause," Chananda said. "As the rightful owners of the land, we deserve to be treated fairly by DISCO. We seek development, not destruction.”

DISCO, which is a subsidiary of Tsingshan Holding Group of China, touted as one of the world’s largest producers of stainless steel, denies any wrongdoing.

In June, some local villagers staged a protest and attempted to block DISCO’s trucks from entering the plant. The villagers accused the company of forcing residents off their farmland with no compensation, resulting in food shortages and severe dust pollution.

Chananda told VOA that while the company welcomes investments and business development, residents felt the company’s behavior had been disrespectful and insensitive.

The giant steel and mining company is erecting a wall around farmland and pastures in the area, further isolating families in Mushenjere Village from the traditional sources of livelihood. Before 2021, when the steel mine came to Manhize, residents in the area relied primarily on subsistence farming for their livelihood.

Villagers said the plant has displaced more than 100 families, leaving them impoverished and food insecure according to villagers.

A September report released by Centre for Natural Resource Governance concluded that Chinese mining operations in Zimbabwe are not necessarily mutually beneficial.

“Evidence on the ground shows a widening rift between Chinese nationals and their Zimbabwean employees and host communities. Increasingly, ordinary Zimbabweans are accusing China of exhibiting colonial traits,” the report said.

The villages near the DISCO “plant have been conspicuously excluded from engagement platforms” by the Chinese company, the report found. The report adds that “this lack of meaningful engagement and consultation has led to feelings of disenfranchisement and marginalization among the affected communities.”

Promises of economic benefits

The $1.5 billion plant started production in July and is expected to create 10,000 new jobs when it reaches the final phase of production. It is currently operating at 60% of its capacity and aims to be at 75% sometime early next year.

Anticipated to be an economic boon to Zimbabwe, the country hopes to reap financial benefits from the project when steel can be exported from the plant in the future.

The steel industry could contribute approximately $5 billion to the national economy, said Winston Chitando, Zimbabwe’s Minister of Mines and Mining Development, after touring the plant in June.

Wilfred Motsi, project director for the Dinson Group, said the development marks a huge milestone in Zimbabwe's manufacturing industry.

"We are going back to our glory days when Zimbabwe was known as one of the industrial hubs in southern Africa because of the opening of the steel industry," said Dinson Group project director, Wilfred Motsi, told Chinese state news agency, Xinhua in June.

Food insecurity and the environment

Despite promises of infrastructure development, including roads and housing, residents said there has been a lack of progress. There is fear that the displacement is exacerbating an already fragile existence among the villagers. In August, the UN described levels of food insecurity in Zimbabwe as “rapidly deteriorating after it was hit with historic droughts.”

Chenjerai Mushore, chairman of three affected villages, echoed these concerns, highlighting the ongoing environmental challenges and a slow compensation process.

Mushore claimed that the mine’s road resurfacing project has led to dust pollution. He emphasized the urgent need to complete the road project to mitigate these risks.

Response to concerns

DISCO’s spokesperson, Joseph Shoko has denied any wrongdoing and told VOA the company is committed to environmental compliance and is investing in state-of-the-art sewage ponds and chimneys.

Since the villagers' farmlands are now within the perimeter of the steel plant, Shoko said DISCO has also been supporting 22 seniors who are considered the head of households with US $200 a month for food since February until they are relocated to a new place to live.

Shoko told VOA there are also plans to support six additional heads of households. Shoko added that younger residents are offered job opportunities instead of monetary assistance. Additionally, the company is prioritizing these residents for employment opportunities as they await relocation, he said.

According to Mushore and Shoko the mine is building new homes in a designated relocation area to accommodate the displaced community.
Shoko further explained that compensation evaluations involving government ministries are currently underway.

"The final compensation amount will be determined by these ministries following a thorough assessment," Shoko concluded.

Chitando, Zimbabwe’s minister of mines, has not responded to VOA’s request for comment.

Zimbabwe-Sino relationship

Zimbabwe and China have maintained a strong alliance over the years. The relationship deepened significantly when Western nations imposed economic sanctions on Zimbabwe during Robert Mugabe's presidency. As international funding and investment declined, China emerged as a major supporter.

Under President Emmerson Mnangagwa, Zimbabwe and China elevated their partnership to a strategic level in 2018. This move facilitated increased Chinese investment, particularly in the extractive industries. However, the DISCO steel plant has been criticized by environmental and human rights activists for its potential negative impact on the environment.

Zimbabwe’s environmental standards agency, the Environmental Management Authority, or EMA, is working with the Steel Mine in addressing the issues which were raised by activists and villagers said the agency’s Environmental Education and Publicity manager, Amkela Sidange. She said EMA is closely overseeing the implementation of abatement measures outlined in a previous environmental audit.

In response to VOA's request for comment, the EMA said that there are currently no environmental violations at the Dinson-Manhize plant; however, "monitoring the progression on implementation of abatement measures proposed on environmental compliance during a previous Environmental Audit by the Agency at the same plant" was conducted a few months ago.

The EMA said the steel company has been addressing issues identified in the audit, including upgrades to the access road from Dinson to Mavise into a tarred road to further reduce dust.

The company is applying for necessary environmental licenses, including for effluent disposal and air emissions, the EMA said, adding that it will continue to monitor the plant "to ensure they are completed within set time frames and ensure the project development is done in a manner that does not harm the environment or health of the public."

Cover photo: A general view of Tsingshan's Dinson Iron and Steel Company production plant in Manhize village in Mvuma, Zimbabwe, June 20, 2024