EXPERTS say barriers to trade, low exports, and structural issues are the current key factors undermining Zimbabwe’s economic performance.
In this year’s Economic Freedom Survey, Zimbabwe ranked 172nd globally and 46th in sub-Saharan Africa, with an economic freedom score of 38.2. The ranking highlights ongoing economic challenges tied to the country’s volatile political environment.
Speaking to NewsDay Business recently, former Economic Society of Zimbabwe president Lovemore Kadenge noted that while regional initiatives like the African Continental Free Trade Area (AfCFTA) promote open markets, Zimbabwe lacks the capacity to export competitive products.
“If other countries ask for our products, do we have any to offer? Unfortunately, most of our citizens are importing goods instead of exporting, which essentially means we’re exporting jobs, “he said.
He criticised Zimbabwe's tariff structures, which he argued discourage local manufacturing.
Kadenge pointed to companies such as Lever Brothers, which relocated to Kenya due to prohibitive import duties on raw materials.
“The challenge we face as a country is that companies like Lever Brothers have moved their manufacturing operations to Kenya and other countries. Here, high tariffs on raw material imports make local production unattractive. These barriers effectively turn Zimbabwe into a retail hub for other nations rather than an economy that creates jobs through local manufacturing,” he added.
He added that revisiting tariffs and regulatory frameworks was critical to fostering a vibrant manufacturing sector and attracting foreign direct investment (FDI).
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Kadenge praised the recent launch of the Zimbabwe Economic Freedom Audit, describing it as a valuable framework for guiding policy reforms.
Developed with input from global institutions like the Fraser Institute, the audit revealed Zimbabwe’s lagging economic freedom compared to regional neighbors such as Mozambique and Botswana.
“There is a clear link between economic freedom, citizen satisfaction, and GDP per capita. Zimbabwe’s lack of independent, well-functioning institutions hinders economic performance. If we expand the tax base by incentivizing formalization, the government could lower tax rates and generate more revenue,” he said.
Meanwhile, the Fraser Institute Economic Freedom of the World director, Fred McMahon emphasized the importance of opening Zimbabwe to global trade.
“The areas that Zimbabwe would benefit from most, and that are easiest to implement, include increasing freedom to trade. To become prosperous, Zimbabwe must view the world as its marketplace. However, there are currently too many barriers preventing Zimbabweans from competing internationally,” McMahon said.
He also highlighted the need to reform labour market regulations, which he argued make it difficult for poor and unskilled workers to enter the formal economy.
“Labor market regulation is a significant obstacle. Simplifying these rules could help more workers, particularly the unskilled, join the formal sector,” McMahon added.
The call for reforms underscores the urgent need for Zimbabwe to create an enabling environment that supports local production, promotes exports, and attracts investment, paving the way for sustained economic growth.
