News / National
Zimra waits for Treasury guidance over US tariff removal
10 Apr 2025 at 09:09hrs | Views
The Zimbabwe Revenue Authority (Zimra) is awaiting formal guidance from the Ministry of Finance, Economic Development, and Investment Promotion regarding the implementation of President Emmerson Mnangagwa's directive to suspend tariffs on goods imported from or manufactured in the United States. This announcement, made over the weekend, aims to boost American imports and shield Zimbabwe's exports from retaliatory tariffs imposed by the United States.
The move follows an 18% reciprocal tariff that the United States, under President Donald Trump, imposed on Zimbabwean goods in response to the country's 35% tariff on American imports. While the presidential directive was welcomed as an effort to ease trade tensions and encourage open markets, the full details of its implementation remain uncertain, leaving importers and businesses awaiting clarity on when the tariff suspension will take effect.
In response to an inquiry from NewsDay Business, Zimra confirmed that the policy is still at high-level discussions. The authority noted that the implementation will proceed once the Ministry of Finance provides the necessary guidance. Zimra emphasized that the forthcoming implementation plan would clarify the criteria for qualifying goods, the origin of these goods, potential quotas, and the extent of tariff exemptions that will apply.
While details remain vague, it is understood that the Ministry of Finance will play a pivotal role in formulating the administrative procedures for the policy. Importers are eager to learn whether the suspension will apply to all goods from the US or if it will be limited to specific products manufactured in the country.
According to the Zimbabwe National Statistics Agency (ZimStat), the United States remains a significant export destination for Zimbabwe, with exports totaling US$48.15 million in 2024. This figure represents an average of US$4.01 million per month. Despite this, the United States does not appear among Zimbabwe's top 20 import sources, indicating that the tariff suspension's impact may be more symbolic than economically significant in the immediate term.
Trade data from the Office of the United States Trade Representative reveals that total trade between the two countries reached US$111.6 million in 2024. Of this, US exports to Zimbabwe amounted to US$43.8 million, up 10.6% from the previous year, while Zimbabwean exports to the US were valued at US$67.8 million, a decrease of 41% from 2023. The resulting trade deficit for Zimbabwe stood at US$24.1 million, marking a 68.1% decline compared to the previous year.
Tapiwa Karoro, president of the Zimbabwe National Chamber of Commerce (ZNCC), described the tariff suspension as a diplomatic maneuver intended to maintain positive relations with the United States, particularly in light of the US's March 2024 Executive Order. He noted that while the suspension signals goodwill, it also raises concerns for local industries already facing challenges such as high production costs, limited access to financing, and inadequate infrastructure. Karoro warned that the suspension of tariffs could lead to increased competition for local manufacturers, who may struggle to compete with cheaper, subsidized imports from the US.
He also pointed out that without additional support measures, such as tax incentives or industrial protection strategies, the policy could lead to further de-industrialization, job losses, and a weakening of domestic supply chains. Moreover, Karoro highlighted the risks of setting a precedent under World Trade Organization (WTO) rules, particularly the Most Favoured Nation (MFN) clause, which requires equal treatment for all trade partners unless an exemption is granted under a formal free trade agreement. Karoro cautioned that other major trading partners, such as China, the European Union, or members of regional blocs like SADC, might demand similar tariff exemptions, potentially eroding Zimbabwe's tariff revenue and weakening its negotiating power in broader regional and international trade agreements.
As Zimra awaits official guidance from the Ministry of Finance, the government faces a delicate balancing act between fostering diplomatic relations with the United States and ensuring the protection of local industries and fiscal stability. The outcome of these deliberations will likely have a significant impact on Zimbabwe's trade policy and economic landscape in the coming months.
The move follows an 18% reciprocal tariff that the United States, under President Donald Trump, imposed on Zimbabwean goods in response to the country's 35% tariff on American imports. While the presidential directive was welcomed as an effort to ease trade tensions and encourage open markets, the full details of its implementation remain uncertain, leaving importers and businesses awaiting clarity on when the tariff suspension will take effect.
In response to an inquiry from NewsDay Business, Zimra confirmed that the policy is still at high-level discussions. The authority noted that the implementation will proceed once the Ministry of Finance provides the necessary guidance. Zimra emphasized that the forthcoming implementation plan would clarify the criteria for qualifying goods, the origin of these goods, potential quotas, and the extent of tariff exemptions that will apply.
While details remain vague, it is understood that the Ministry of Finance will play a pivotal role in formulating the administrative procedures for the policy. Importers are eager to learn whether the suspension will apply to all goods from the US or if it will be limited to specific products manufactured in the country.
Trade data from the Office of the United States Trade Representative reveals that total trade between the two countries reached US$111.6 million in 2024. Of this, US exports to Zimbabwe amounted to US$43.8 million, up 10.6% from the previous year, while Zimbabwean exports to the US were valued at US$67.8 million, a decrease of 41% from 2023. The resulting trade deficit for Zimbabwe stood at US$24.1 million, marking a 68.1% decline compared to the previous year.
Tapiwa Karoro, president of the Zimbabwe National Chamber of Commerce (ZNCC), described the tariff suspension as a diplomatic maneuver intended to maintain positive relations with the United States, particularly in light of the US's March 2024 Executive Order. He noted that while the suspension signals goodwill, it also raises concerns for local industries already facing challenges such as high production costs, limited access to financing, and inadequate infrastructure. Karoro warned that the suspension of tariffs could lead to increased competition for local manufacturers, who may struggle to compete with cheaper, subsidized imports from the US.
He also pointed out that without additional support measures, such as tax incentives or industrial protection strategies, the policy could lead to further de-industrialization, job losses, and a weakening of domestic supply chains. Moreover, Karoro highlighted the risks of setting a precedent under World Trade Organization (WTO) rules, particularly the Most Favoured Nation (MFN) clause, which requires equal treatment for all trade partners unless an exemption is granted under a formal free trade agreement. Karoro cautioned that other major trading partners, such as China, the European Union, or members of regional blocs like SADC, might demand similar tariff exemptions, potentially eroding Zimbabwe's tariff revenue and weakening its negotiating power in broader regional and international trade agreements.
As Zimra awaits official guidance from the Ministry of Finance, the government faces a delicate balancing act between fostering diplomatic relations with the United States and ensuring the protection of local industries and fiscal stability. The outcome of these deliberations will likely have a significant impact on Zimbabwe's trade policy and economic landscape in the coming months.
Source - newsday
