'Zimbabwe economy stable despite external shocks'

The Zimbabwean economy has remained broadly resilient in the first quarter of 2026 despite rising global uncertainty driven by geopolitical tensions in the Middle East, which have contributed to higher energy costs and commodity price volatility, Information, Publicity and Broadcasting Services Minister Zhemu Soda has said.

Addressing a post-Cabinet media briefing, Dr Soda said external pressures had created downside risks to the domestic economy, particularly through their impact on agriculture, inflation, exchange rates and foreign reserves.

He said higher fertiliser prices, along with increased shipping and insurance costs, were affecting agricultural production and could potentially weigh on crop yields and food security.

Despite these challenges, Dr Soda said the domestic economy had remained stable due to macroeconomic reforms, improved agricultural output supported by favourable rainfall, and ongoing efforts to improve the ease of doing business.

"The first quarter of 2026 was characterised by elevated global uncertainty, primarily reflecting escalating geopolitical tensions in the Middle East," he said.

The Government is projecting economic growth of around five percent for 2026, driven largely by recovery in agriculture and continued expansion in the mining sector.

According to Dr Soda, fiscal performance has remained stable, with projected revenues of US$9.4 billion against expenditure of US$9 billion, while US$2 billion has already been collected in the first quarter.

He said this performance reflects improved revenue collection and tighter expenditure management.

To cushion the economy from external shocks, Government has introduced measures including the removal of certain diesel taxes to help contain inflation and support production sectors.

Dr Soda also noted that inflation has continued to decline significantly compared to last year, falling from peak levels above 90 percent to 4.1 percent in January, easing further to 3.8 percent in February before rising slightly to 4.4 percent in March due to global oil price pressures.

He said the sustained decline in inflation reflects the effectiveness of Government stabilisation measures.

Looking ahead, export performance is expected to remain strong, supported by key commodities including gold, platinum group metals, lithium and tobacco.