ZIMBABWE’S trade deficit worsened in the first quarter of 2025, with imports surging by nearly 7%, while exports grew by a marginal 1,5%, according to data released by the Zimbabwe National Statistics Agency (Zimstat).
The country’s trade deficit — the gap between imports and exports — ballooned to US$543 million between January and March 2025, up from US$424 million in the same period last year, marking a 28% increase.
Zimbabwe’s import bill rose to US$2,29 billion, driven largely by fuel, electricity, and essential manufactured goods.
South Africa remained the largest source of imports, followed by China, the Bahamas, Mozambique and the United Arab Emirates (UAE).
Economists attribute the increase to persistent power shortages and limited local production capacity. On the export front, Zimbabwe earned US$1,75 billion, a slight uptick from US$1,72 billion in 2024.
The country continues to rely heavily on mineral exports, with gold and other raw materials making up the bulk of shipments to the UAE, China and South Africa.
However, weak global commodity prices and limited value-added processing have stifled faster growth. The widening trade deficit raises concerns about Zimbabwe’s foreign currency reserves and its ability to stabilise the local currency.
Experts warned that without boosting industrial output and diversifying exports, the deficit could further strain the economy.
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“The 28% year-on-year increase in trade deficit represents a concerning structural deterioration,” Stevenson Dhlamini, a research fellow at the Public Policy and Research Institute of Zimbabwe, said.
“The widening gap suggests deeper macroeconomic imbalances. Import growth (6,8%) significantly outpaced export growth (1,5%). This 5,3 percentage point growth differential is particularly troubling and suggests declining terms of trade and competitive position. Also the growing deficit will strain forex reserves.”
Economist Trust Chikohora noted that the global economy was under significant pressure, particularly due to trade wars and policies emerging from the United States.
“This has adversely affected global trade, consequently impacting export growth across the board, including minerals, as they are essential in manufacturing various goods now constrained by the economic slowdown,” Chikohora said.
“On the import side, electricity shortages have created additional pressures, especially following last year’s drought and operational challenges at Hwange. With low electricity generation, imports of power have increased.
“Furthermore, we may not have fully recovered from the maize shortages caused by previous droughts.”
Consequently, Chikohora said, the gap between imports and exports continues to widen, a trend likely to persist given ongoing global market challenges.
“Compounding these external factors are domestic economic issues: high business costs that discourage exports, alongside production constraints such as unreliable electricity, inadequate road networks and poor water infrastructure, among others,” he said.
“This negative trend may continue affecting Zimbabwe unless corrective policies are implemented to enhance competitiveness, stimulate exports, and encourage investment, both foreign and domestic.”
