Note from ZNCC
The Zimbabwe National Chamber of Commerce (ZNCC) participated in a high-level meeting with the Ministry of Industry and Commerce on 04 February 2025 in Harare to discuss key economic challenges including informality, currency stability, regulatory burdens and sustainable industrialisation. The engagement aimed to foster collaboration between the public and private sectors in crafting solutions to improve Zimbabwe’s business climate.
The meeting was attended by the Minister of Industry and Commerce, Nqobizitha Ndhlovu, Permanent Secretary Dr. Thomas Wushe, among other senior officials in the Ministry of Industry and Commerce. Representing the ZNCC were past presidents, Mrs. Marah Hativagone and Mr. Luxon Zembe, Harare branch chairperson Mr. Ephraim Chawoneka, ZNCC CEO Mr. Christopher Mugaga and various business leaders from multiple sectors.
In his opening remarks, Dr. Wushe underscored the significance of private-sector involvement in national development, emphasising that economic progress requires a collective effort as Zimbabwe transitions from the National Development Strategy 1 (NDS1) to NDS2. Minister Ndhlovu reaffirmed the government’s commitment to creating a more favourable business environment, citing the 2024 ZNCC Annual State of Industry and Commerce Survey Report, which highlights constraints such as limited access to foreign currency, excessive regulatory requirements, energy shortages and inefficient trade facilitation.
During the discussions, Mr. Zembe raised concerns about currency instability and exchange rate unpredictability, which continue to challenge business planning and investor confidence. While some relative stability has been observed, he emphasised that its sustainability remains uncertain. Mr Zembe pointed out the misalignment between the monetary and fiscal policies, where the Reserve Bank of Zimbabwe (RBZ) is aggressively withdrawing liquidity from the market while the Ministry of Finance simultaneously enforces stringent taxation. He warned that such an approach stifles economic activity, making it harder for businesses to thrive.
Minister Ndhlovu acknowledged these concerns and assured participants that the government is actively engaging with the RBZ and Treasury to achieve a more balanced approach that maintains monetary stability while ensuring adequate liquidity for business growth.
A key issue addressed was the expanding informal economy, which continues to dominate Zimbabwe’s business landscape. Dr. Wushe referenced recent pronouncements by Minister of Finance, Economic Development and Investment Promotion, Prof. Mthuli Ncube on efforts to formalise the informal sector. He requested ZNCC to submit formal recommendations for Cabinet consideration to further improve on the measures to address informality. Currently, government measures to curb informality include a 5 percent withholding tax on unregistered MSMEs, a reduced VAT registration threshold, mandatory Point-of-Sale (POS) machines, and stricter import controls on certain goods to curb smuggling. However, ZNCC members contended that these measures alone are insufficient to encourage informal enterprises to formalise.
Mr. Chawoneka, chairperson of ZNCC Harare branch, noted that regulatory complexity and high compliance costs deter businesses from transitioning into the formal economy. The ZNCC delegation proposed several alternative measures, including a graduated tax system and a simplified e-government platform for registration and compliance. Additionally, the chamber called for public procurement incentives that prioritise formalised small businesses and nationwide educational campaigns on the benefits of formalisation.
The issue of energy availability was also high on the agenda, with ZNCC CEO Mr. Christopher T. Mugaga highlighting how inconsistent electricity supply and high tariffs are hindering industrial productivity. He noted that many businesses have since resorted to alternative energy sources such as solar and diesel generators. Mrs. Makombe from the Ministry of Industry and Commerce echoed these concerns, warning that energy constraints are discouraging investment and forcing some businesses to relocate to more stable markets in neighbouring countries.
To enhance policy-making and enforcement, ZNCC proposed leveraging the national energy grid as a tool to monitor economic activity. By analysing electricity consumption data, authorities could identify high-density business clusters, detect unregistered economic activities, and design targeted incentives to encourage formalisation. The use of energy pricing models could also be explored to incentivise tax compliance among businesses.
Trade facilitation and border inefficiencies were another focal point of discussion. Representatives from the Shipping and Forwarding Agency Association of Zimbabwe lamented the excessive bureaucracy at the country’s entry points, noting that importers often have to navigate up to 25 different regulatory agencies, leading to unnecessary delays and increased operational costs. The Chamber recommended harmonising border processes, enhancing the Zimbabwe Electronic Single Window System and reducing redundant compliance requirements to improve trade efficiency.
Minister Ndhlovu concluded the meeting by affirming the government’s commitment to ongoing engagement with the private sector to ensure an improved business climate. The government pledged to explore ways to streamline regulatory frameworks, reduce compliance costs and enhance collaboration with industry stakeholders.
ZNCC remains steadfast in its commitment to working with the government to achieve a more stable, formalised, and competitive economy. Business leaders welcomed the Ministry’s receptiveness to private-sector concerns and expressed optimism that continued engagement will yield practical policy interventions that drive economic growth.
The meeting ended on a positive note, with consensus on the importance of continuous dialogue and action-oriented policy reforms. Moving forward, both parties agreed to maintain regular engagements to assess the impact of policy changes and ensure that Zimbabwe’s economic trajectory remains favourable for business development.
This article was prepared by the Zimbabwe National Chamber of Commerce for Business Weekly
