Chinese company Dinson Iron & Steel has broken ground on a $1bn iron and steel-making industrial park in the Zimbabwean town of Mvuma, the Bulawayo 24 news site reports.

Construction of a steel plant at the site is already underway and is expected to start operating next August, when it will take advantage of the country’s rich ore deposits to produce some 1.2 million tonnes of steel a year when it reaches full capacity.

Zimbabwe’s President Emmerson Mnangagwa described the industrial park as a “paradigm-shifting milestone” in the country’s journey to industrialisation.

“Through this investment, our country will now host one of the largest iron and steel manufacturing plants on the continent,” he said.

“It is envisaged to leap-frog us to emerge as a dynamic industrial hub, churning out a broad range of value-added ‘Made in Zimbabwe’ iron and steel products for both local and international markets,” he added.

The president also expressed a desire for a future “smart city” at the industrial park. He said government agencies had been directed to accelerate the finalisation of its masterplan.

Among the developments that will take place around the steel plant are rail links to Mozambique and the Democratic Republic of Congo, as well as roads, a hydroelectric dam, a power line, as well as schools, clinics and houses.

Chen Shang Song, chairman of Dinson, said his group has spent about $500m in Zimbabwe so far, a total that would eventually rise to $3bn.

The project has major political and economic importance to the country. If all goes to plan, it will create 10,000 jobs and end Zimbabwe’s reliance on imports for 90% of its steel.

So far, work has been completed on the administration blocks, the foundations for the blast furnaces and access roads.

Dinson Iron and Steel Company is a subsidiary of investment group Tsingshan Holdings. Alongside the steel plant, it has invested in the production of the limestone and coke required by the Mvuma plant. Coal-to-coke processing has begun in the Hwange area of Matabeleland North province, as has limestone mining in Masvingo.