'Zimbabwe economy to grow 6%'

Zimbabwe's economy is projected to expand by 6.6% this year, driven by strong performance in agriculture, services, and mining, according to the latest Zimbabwe Economic Update (ZEU). The report, titled Fostering a Business-Enabling Regulatory Environment for Private Sector Growth, predicts that economic growth will remain positive in the medium term, with a 5% expansion forecast for 2026 despite potential challenges such as fiscal slippages, external shocks, and climate-related disasters.

The ZEU report also highlights that inflation is expected to ease to single digits this year and fall further to 5% over the medium term, supported by Zimbabwe's tight monetary policy since late 2024, which has helped stabilise the Zimbabwe Gold (ZiG) currency.

"Poverty is expected to decline gradually as growth recovers, but remains sensitive to weather shocks and inflation, particularly for rural households dependent on rain-fed agriculture, with limited off-farm job opportunities and inadequate social protection," the report noted.

The report urged the government to accelerate reforms aimed at simplifying and streamlining business regulations, maintaining macroeconomic stability, and enhancing the ease of doing business. "Continued efforts to anchor the existing price and exchange rate stability will support economic growth and job creation while avoiding a reversal of the prevailing stability gains," it stated.

ZEU examined Zimbabwe's business landscape through case studies across multiple sub-sectors, highlighting the heavy regulatory burden faced by firms. Agriculture, agro-processing, and tourism sectors, for instance, are subject to as many as 28 separate legal and regulatory requirements spanning multiple government ministries and agencies. The report noted that compliance-related fees and levies in some sectors can exceed annual business revenues, with many requirements still reliant on paper-based processes and physical visits to offices, creating procedural bottlenecks and additional costs with minimal public policy gain.

Despite these challenges, the report acknowledged progress under the government's Presidential Ease of Doing Business initiative. The first phase, finalised in September 2025 with support from the World Bank Group, focused on the beef, dairy, stock feed, and tourism sectors, resulting in the reduction or elimination of several levies and fees.

Senior economist Victor Steenbergen emphasized the need for sustained reforms to strengthen Zimbabwe's private sector. "The macroeconomy is improving," Steenbergen said. "Prioritizing efforts to improve the ease of doing business is essential to enhance private sector growth and competitiveness, ensuring that economic growth translates into lasting benefits for the country."

The ZEU report underscores that while economic indicators are improving, continued government action is critical to ensure that growth remains inclusive and sustainable, particularly for rural households and small businesses navigating complex regulatory frameworks.