Zimbabwe plans third GDP rebase

The government plans to rebase Zimbabwe's economy for a third time in less than a decade, a move that could significantly reshape key economic indicators just two years before the country's target of attaining upper-middle-income status under Vision 2030.

Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube said the rebasing exercise is part of an internationally recognised statistical practice designed to ensure national accounts accurately reflect changes in the structure of the economy.

The planned exercise follows major rebasing exercises undertaken in 2018 and 2025, both of which substantially increased the estimated size of Zimbabwe's economy.

In 2018, the country's base year was revised from 2009 to 2012, increasing the value of gross domestic product (GDP) by 22.5%, from about US$1.24 billion to US$1.51 billion. The exercise also altered the composition of the economy, with manufacturing overtaking agriculture as Zimbabwe's second-largest contributor to GDP after wholesale and retail trade.

A second rebasing exercise completed in 2025 raised Zimbabwe's estimated GDP for 2024 to US$35.2 billion and lifted gross national income per capita above US$3,000, bringing the country closer to the World Bank's threshold for upper-middle-income economies.

The government said the latest revision incorporated findings from the Economic Census, which identified 204,798 operational business establishments, although more than 76% were operating in the informal sector.

Speaking during an online media briefing from China, where he is leading Zimbabwe's delegation to the 17th Annual Meeting of the New Champions hosted by the World Economic Forum, Ncube said rebasing is a routine statistical process undertaken every five years.

"A rebasing is a global norm in terms of national statistics, a recognised standard where we have to rebase every five years. So, the last rebase was in 2018, then 2023 and then the next rebasing will be in 2028, so we are going to rebase again," Ncube said.

He explained that the 2025 rebasing exercise began in 2023 and said preparations for the next exercise would start in 2027 before being completed around the end of 2028 or early 2029.

"That is normal. So, it does not mess up any trends really; it just shows that if your economy is evolving then you are able to capture the new sectors, shifting sectors' contributions to always recapture them accurately. So, rebasing is necessary for a more accurate representation of the economy and its sub-sectors," he said.

"Again, we will start the work in 2027, next year and hopefully, end of 2028 or early 2029, complete it. It takes quite a while — 18 months to do — to allow us to be thorough."

However, economists caution that repeated rebasing exercises, combined with exchange-rate distortions and methodological changes, make it increasingly difficult to distinguish between genuine economic expansion and statistical revisions.

They argue that while rebasing improves the accuracy of national accounts, it does not necessarily reflect improvements in living standards, employment or household incomes.

The planned 2028 rebasing will be completed just two years before the government's Vision 2030 target, raising questions over whether Zimbabwe's eventual upper-middle-income status will be driven primarily by sustained economic growth or by revised statistical measurements.

The debate comes against a backdrop of persistent economic challenges, including a rising cost of living, high unemployment, declining purchasing power, constrained liquidity, business closures and continued difficulties in attracting foreign investment.

Economist Tony Hawkins said rebasing was necessary given the structural changes Zimbabwe's economy has experienced over recent decades, but warned that it complicates long-term comparisons of economic performance.

He noted that Zimbabwe's economy has become increasingly dependent on gold exports, limiting opportunities for broad-based GDP growth.

"You take gold out, then the situation will be very different," Hawkins said.

He also warned that the developing El Niño weather pattern could significantly affect agricultural production and economic growth over the next two years.

"If you look at last year, a third of the GDP growth came from agriculture; that is because of the rebound from a very poor season before to a good season, with bigger and higher tobacco prices.

"Now, this time round, there could be the exact reversal in that. So, I think it becomes harder and harder to interpret changes in growth, what causes them and what undermines them."

Hawkins also questioned the sustainability of Zimbabwe's exchange-rate regime, arguing that the country's apparent exchange-rate stability reflects a tightly managed currency rather than a fully market-determined system.

"We cannot go on forever pretending that we don't have a fixed exchange rate with the US dollar. It is a fiction that suits the government politically," he said.

He added that international institutions such as the World Bank and International Monetary Fund ultimately determine whether countries qualify as upper-middle-income economies.

"When you say that you are an upper-middle-income economy, you have to convince the World Bank, International Monetary Fund and others, who carry out the calculation.

"So, it is not just the Zimbabwe government saying that. If the figures are obviously phoney, then the international guys will say we do not accept that."

Hawkins also highlighted the difficulties of measuring an economy in which the majority of activity occurs outside the formal sector.

"You are looking at an economy that is two-thirds informal, so there is a hell of a lot of guesswork in getting to those output numbers," he said.

"Some of the numbers you get them, very solid, from the private sector and so on — the formal private sector. But then, if you turn to what is happening in the informal private sector, who knows how reliable the numbers are."

Africa Economic Development Strategies (AEDS) executive director Gift Mugano agreed that rebasing was a normal statistical exercise but argued that stronger economic fundamentals were needed if Zimbabwe was to achieve sustainable development.

"The first thing to have is economic stability as a minimum requirement, as a foundation for building this country forward better," Mugano said.

"We cannot stop poverty when we are in poverty; we cannot address jobs when you have a yoyo economy, but you cannot have stability in one and a half years and then have an eradication of poverty."

He said economic stability should now be translated into tangible improvements in people's lives through better healthcare, job creation and public service delivery.

"In our conversation with government as AEDS, we told them we now need to lay a foundation for inclusive development where the benefit and dividend of our economic stability begin to now pay off dividends, making sure there is the availability of medicine, hospitals, meaningful jobs in terms of job creation."

Mugano also called for greater transparency and accountability in the management of foreign currency resources.

He argued that although macroeconomic conditions had improved, the effects of previous economic instability continued to weigh heavily on businesses and households.

"Let us accept that we are here because of economic hardships, which have been affecting us for close to three decades now," he said.

"So, what you see as the outcome of OK Zimbabwe is one of the major issues where there was a currency crisis which saw the crash of the ZiG in September 2024 and wiped the balance sheet of many companies beyond OK.

"So, we are still burning even if we have economic stability and that is the reality on the ground. We need to accept that. There is no way you can say there is now stability, things are normal — no. Even the mindset of people is traumatised, which leads them to say, 'How do we trust you?' The informal sector is as a result of the collapse of the formal sector."