ECONOMY IS TANKING : BUSINESS

The business community has raised concern over Zimbabwe’s challenging operating environment and called for urgent reviews and measures to arrest the economic haemorrhage.

They voiced concern about regulatory burdens, compliance costs, currency and macroeconomic instability threatening private sector viability.

Zimbabwe sits at 124th globally and 20th in Africa on competitiveness rankings, hampered by macroeconomic instability, exchange rate volatility and policy coordination challenges.

Reports indicate that a number of companies are struggling to stay afloat, with many either downsizing or closing under the weight of economic pressure.

On Monday, representatives of the business community met Industry and Commerce minister Mangaliso Ndlovu and urged him to facilitate reforms in the upcoming National Development Strategy 2 (NDS 2) to address the pressing challenges bedevilling them.

Ndlovu acknowledged their concerns.

He, however, applauded the private sector for heeding government's call for increased production while acknowledging ongoing challenges.

“Statistics show growth in the manufacturing sector, but growing levels of informalisation remain a challenge,” Ndlovu said.

“We have made significant progress on reserve sectors and a statutory instrument will be made to that effect. Business sustainability is very important and I have taken note of the points raised.”

Ndlovu recently stated that repetitive licences contributing to unsustainable overhead costs will be eliminated within six months.

At the National Competitiveness Commission Summit last week, Ndlovu urged stakeholders to focus on solutions rather than “ranting”

Zimbabwe National Chamber of Commerce president, Tapiwa Karoro, said there was need for regular engagements to address industry concerns.

“These engagements are vital in shaping the nation’s future growth trajectory, but we must acknowledge the alarming constraints businesses face daily — from excessive regulatory compliance costs to currency volatility,” Karoro said.

“What we have done today should be taken as a launchpad for further accelerating reforms that will ease the costs of doing business while ensuring the private sector agenda remains the hallmark for future economic development in Zimbabwe.”

CBZ Holdings chairperson Luxon Zembe stressed the importance of a unified approach as Zimbabwe transitions to the NDS 2 phase:

“While we accept that the government is making efforts to position Zimbabwe as a favourable business destination, as the private sector, we want to complement that towards a win-win situation,” Zembe said.

Chairperson of the CEO Africa Roundtable Oswell Binha underscored the importance of strengthening engagement frameworks.

“There are still many challenges on the way, but they can be overcome with confidence restored from short to long term,” Binha said.

“The private sector has its fair share of challenges, but with the government committing to the national goal of common purpose, these can be overcome to enable the economy to move forward.”

The business community’s concerns come amid ongoing struggles with regulatory compliance costs.

The two parties resolved to scale up relations, riding on the need to facilitate a conducive business environment.

Zimbabwe faces substantial challenges regarding debt sustainability and access to external financing.

Public debt remains high, unsustainable and in distress, with total public debt reaching US$21,2 billion in 2023 due to the accumulation of external arrears and legacy debts.

Government, however, says it is implementing IMF-backed reforms to extricate from the debt crisis, rebuild international creditor trust and unlock concessional financing.

These reforms include strengthening public financial management, improving State enterprise transparency and operationalising a rules-based monetary policy framework.

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