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Zimbabwe's manufacturing growth target missed
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The Zimbabwe National Industrial Development Policy (ZNIDP) 1, aimed at growing the manufacturing sector by at least 2% annually, has failed to meet its target due to ongoing macroeconomic instability, according to a draft framework for its successor policy.
Launched by the government to revive and transform the manufacturing industry, ZNIDP 1 (2019-2023) aimed for ambitious targets including a 2% annual manufacturing growth rate, 16% growth in manufacturing value added, a 10% increase in merchandise exports, and boosting manufacturing employment share to 20% by 2023.
However, these objectives were largely unrealised as the sector's contribution to Zimbabwe's economy shrank to 9%, down from a peak of 23%, according to data from the Confederation of Zimbabwe Industries (CZI).
Key challenges cited include macroeconomic instability, policy inconsistency, exchange rate volatility, low liquidity, deteriorating infrastructure, and poor utility service delivery.
In response, CZI and the Ministry of Industry and Commerce have commenced consultative workshops to formulate ZNIDP 2, covering 2026 to 2030. The workshops began today in Bulawayo and will proceed in Harare on Wednesday and Mutare on Friday.
The draft framework for ZNIDP 2 outlines a strategic shift to promote sustainable and diversified industrial growth, enhance productivity, and drive structural transformation by accelerating investment in Zimbabwe's industrial sector.
ZNIDP 2 sets more ambitious goals, including increasing the manufacturing growth rate from the current 1.6% annual average over the past four years to at least 5% annually; raising the sector's GDP share from 16.1% to 20%; boosting manufactured exports from 7.5% to 10%; increasing manufacturing's employment share from 8.3% to 12%; and improving capacity utilisation from 51% to 60%.
The framework also references the Zimbabwe Industrial Reconstruction and Growth Plan (ZIRGP) 2024-2025, which aimed to address immediate sector challenges and align industrial policy with the forthcoming National Development Strategy (NDS) 2 for 2026-2030.
ZIRGP focused on strengthening value chains, import substitution, rural industrialisation, local content implementation, SME linkages, financing, idle infrastructure utilisation, informalisation, combating smuggling and counterfeit goods, improving ease and cost of doing business, and enhancing government-private sector collaboration.
The draft ZNIDP 2 also acknowledges regional trade developments including the African Continental Free Trade Area, SADC, and COMESA, which offer opportunities for industrial growth and market expansion.
With the Treasury currently formulating the NDS 2, the new industrial policy is expected to serve as a critical pillar in driving Zimbabwe's economic transformation over the next five years.
Launched by the government to revive and transform the manufacturing industry, ZNIDP 1 (2019-2023) aimed for ambitious targets including a 2% annual manufacturing growth rate, 16% growth in manufacturing value added, a 10% increase in merchandise exports, and boosting manufacturing employment share to 20% by 2023.
However, these objectives were largely unrealised as the sector's contribution to Zimbabwe's economy shrank to 9%, down from a peak of 23%, according to data from the Confederation of Zimbabwe Industries (CZI).
Key challenges cited include macroeconomic instability, policy inconsistency, exchange rate volatility, low liquidity, deteriorating infrastructure, and poor utility service delivery.
In response, CZI and the Ministry of Industry and Commerce have commenced consultative workshops to formulate ZNIDP 2, covering 2026 to 2030. The workshops began today in Bulawayo and will proceed in Harare on Wednesday and Mutare on Friday.
The draft framework for ZNIDP 2 outlines a strategic shift to promote sustainable and diversified industrial growth, enhance productivity, and drive structural transformation by accelerating investment in Zimbabwe's industrial sector.
ZNIDP 2 sets more ambitious goals, including increasing the manufacturing growth rate from the current 1.6% annual average over the past four years to at least 5% annually; raising the sector's GDP share from 16.1% to 20%; boosting manufactured exports from 7.5% to 10%; increasing manufacturing's employment share from 8.3% to 12%; and improving capacity utilisation from 51% to 60%.
The framework also references the Zimbabwe Industrial Reconstruction and Growth Plan (ZIRGP) 2024-2025, which aimed to address immediate sector challenges and align industrial policy with the forthcoming National Development Strategy (NDS) 2 for 2026-2030.
ZIRGP focused on strengthening value chains, import substitution, rural industrialisation, local content implementation, SME linkages, financing, idle infrastructure utilisation, informalisation, combating smuggling and counterfeit goods, improving ease and cost of doing business, and enhancing government-private sector collaboration.
The draft ZNIDP 2 also acknowledges regional trade developments including the African Continental Free Trade Area, SADC, and COMESA, which offer opportunities for industrial growth and market expansion.
With the Treasury currently formulating the NDS 2, the new industrial policy is expected to serve as a critical pillar in driving Zimbabwe's economic transformation over the next five years.
Source - Newsday
