• Merchandise exports reached a six-month high of USD 727.3 million, driven by gold and nickel contributions
• Imports rose to USD 882 million, widening the trade deficit
• Historically, Zim achieved a positive trade balance in 1999 and 2000

Harare- Zimbabwe’s merchandise exports reached a six-month high of USD 727.3 million in May 2025, reflecting a 9.6% month-on-month increase from USD 663.8 million in April 2025, according to Zimstat data.

This surge was predominantly driven by a record-high contribution from gold exports, which accounted for 50.2% of total exports (USD 368.1 million), marking the first time in Zimbabwe’s history that a single commodity exceeded half of export value.

Nickel mattes also exhibited significant growth, rising from USD 98.72 million to USD 138.95 million, while ferroalloys increased marginally from USD 20.85 million to USD 25.98 million.

 Top exports in US$ mns

Conversely, tobacco exports declined sharply from USD 71.91 million to USD 35.78 million due to the seasonal closure of the tobacco selling season, and ferro-chrome saw a slight decrease from USD 30.4 million to USD 29.9 million.

Industrial supplies dominated the export composition, comprising 91.9% of total exports, with gold (50.2%), nickel mattes (19.1%), tobacco (4.5%), other mineral substances (4.1%), and ferro-chrome (3.5%) as key contributors.

The primary export markets were the United Arab Emirates (51.1%, USD 237 million), South Africa (30.8%, USD 141.88 million), and China (5.8%, USD 121.15 million), collectively accounting for 88% of export value.

Despite this robust export performance, imports rose by 9.8% to USD 882.1 million from USD 803.7 million in April, driven by significant increases in motor vehicles for goods transport (from USD 19 million to USD 34 million), non-domestic heating/cooling equipment (from USD 12 million to USD 25.5 million), soybean oil (from USD 19.3 million to USD 23.7 million), motor cars (from USD 15.5 million to USD 18.2 million), and rice (from USD 6 million to USD 17.3 million).

These increases offset declines in petroleum oils (from USD 16 million to USD 14.9 million), maize (from USD 43 million to USD 31 million), and meslin wheat (from USD 21 million to USD 15 million).

Industrial supplies (32%) and capital goods (20.5%) dominated imports, with South Africa (34.8%), China (19.0%), Bahrain (7.3%), and the Bahamas (5.9%) supplying 67% of the import bill.

Imports in US$ mn

Consequently, the trade deficit widened by 10.7% to USD 154.8 million in May from USD 139.8 million in April, showing the persistent challenge of import growth outpacing export gains.

Drivers of Export Growth and Failure to Offset Deficit

Export growth in May 2025 (9.6% to USD 727.3 million) was propelled by robust global demand for gold (50.2%) and nickel mattes (19.1%), reflecting favourable commodity prices and Zimbabwe’s mineral wealth.

The UAE (51.1%), South Africa (30.8%), and China (5.8%) absorbed 88% of exports, with gold dominating shipments to the UAE and nickel to China.

However, the trade deficit persists due to the higher absolute value and growth rate of imports (USD 882.1 million, up 9.8%).

The export base remains heavily concentrated in primary commodities (91.9% industrial supplies), which are vulnerable to global price volatility and lack value addition, limiting revenue potential.

Seasonal declines in tobacco exports (down to USD 35.78 million in May 2025) further constrain export earnings.

Structural constraints, including high production costs, power shortages, and an unfavorable investment climate, hinder export diversification and competitiveness, preventing exports from offsetting import growth

Strategies to Narrow the Import Base

To reduce import dependency, Zimbabwe must pursue import substitution and structural reforms.

First, revitalising agriculture through irrigation investment, farmer training, and credit access could restore food self-sufficiency, reducing imports of maize, wheat, and soybean oil.

Second, developing renewable energy sources (e.g., solar, hydroelectric) could mitigate reliance on imported petroleum and electricity, which accounted for 20% of 2023 imports.

Third, fostering domestic manufacturing of consumer goods like vehicles and machinery through tax incentives and industrial modernisation could curb capital goods imports (20.5% in May 2025).

Fourth, enhancing foreign exchange availability by reforming export retention policies would enable industries to access inputs affordably, boosting local production.

Finally, diversifying import sources via trade agreements with African or Asian partners could leverage competitive pricing to lower import costs.

Historical Trade Dynamics: 1980–2000

Sources:World Bank, Macrotrends, Zimstat, Equity Axis

Between 1980 and 2000, Zimbabwe’s trade balance exhibited relative resilience, underpinned by a diversified export portfolio and favourable post-independence economic conditions.

Following the lifting of sanctions in 1979, Zimbabwe experienced robust real GDP growth exceeding 20% in 1980–1981, bolstered by strong export performance in agriculture (tobacco, cotton, beef) and minerals (gold, nickel).

The agricultural sector, leveraging Zimbabwe’s status as a net food exporter in non-drought years, contributed to trade surpluses in six of the eight years from 1992 to 2000, driven by cash crops like citrus fruits and tobacco.

The last recorded trade surplus occurred in December 2000, reaching USD 293 million, propelled by peak exports of flue-cured tobacco, gold, and nickel.

The Common Market for Eastern and Southern Africa (COMESA) free trade area, launched in November 2000, further supported export growth through preferential market access for food products, manufactures, and chemicals.

However, exogenous shocks, including droughts in 1982–1984 and 1986–1987 and a foreign exchange crisis, periodically disrupted trade balances, leading to temporary deficits.

Despite these challenges, Zimbabwe’s terms of trade averaged 98.75% (base year 2000) from 1980 to 2020, reflecting relatively stable export-import price dynamics

Trade Dynamics: 2000–Present 

Since 2001, Zimbabwe has faced persistent trade deficits, with no annual surplus recorded, driven by structural economic disruptions and a narrowing export base.

The controversial land reform program initiated in 2000, which redistributed approximately 6,000 white-owned commercial farms to over 168,000 black-owned farms, precipitated a collapse in agricultural productivity.

Inexperienced farmers and lack of access to credit led to a sharp decline in exports of tobacco, beef, and horticulture, transforming Zimbabwe into a net food importer.

The trade deficit peaked at USD -3.96 billion in 2009 amid hyperinflation and currency overvaluation, with subsequent deficits of USD -2.48 billion in 2022 and USD -1.98 billion in 2023.

Manufacturing exports plummeted from USD 740 million in 2011 to USD 470 million in 2018 due to liquidity constraints, high input costs, and chronic power shortages.

Despite recent export growth evidenced by a 9.7% increase in merchandise exports to USD 7.22 billion in 2023, driven by gold (31%), tobacco (17.9%), and nickel (13.6%) imports grew by 6.99% to USD 9.2 billion, led by mineral fuels (20%), machinery (13.2%), and vehicles (8.34%).

Macroeconomic instability, including an 89.8% depreciation of the Zimbabwe dollar in 2023 and intermittent foreign exchange shortages, further exacerbated import costs

Last Recorded Trade Surplus

Zimbabwe’s last trade surplus was recorded in December 2000, valued at USD 151.4 million, driven by strong exports of tobacco, gold, and nickel, supported by a diversified export base and stable macroeconomic conditions prior to the land reforms.

Since then, structural economic challenges have perpetuated annual trade deficits.

Determinants of Import Growth 

Zimbabwe’s import growth is driven by structural and macroeconomic factors.

First, the post-2000 decline in agricultural productivity necessitated increased imports of food commodities, such as maize, wheat, and soybean oil, particularly during El Niño-induced droughts, with May 2025 data showing a tripling of rice imports to USD 17.3 million.

Second, Zimbabwe’s status as a net importer of mineral fuels (20% of 2023 imports) and capital goods (e.g., machinery, vehicles) reflects limited domestic production capacity and reliance on imported inputs for industry.

Third, consumer demand for value-added products, such as motor vehicles (USD 34 million in May 2025) and heating/cooling equipment (USD 25.5 million), has surged due to inadequate domestic manufacturing.

Fourth, currency depreciation exemplified by the Zimbabwe dollar’s 89.8% devaluation in 2023 and 43% devaluation of ZiG in late September 2024 has inflated import costs, while foreign exchange shortages constrain domestic production, increasing reliance on imports.

Major import partners, including South Africa (40.44%) and China (13.86%), dominate supply chains, reinforcing import dependency.

Strategies to Improve the Trade Balance

Improving Zimbabwe’s trade balance requires export diversification, value addition, and macroeconomic stabilisation.

First, investing in mineral beneficiation (e.g., refining gold, nickel, and diamonds) and agro-processing could enhance export value, moving beyond primary commodities (91.9% of May 2025 exports).

Second, stabilising the Zimbabwe Gold (ZiG) currency and reducing fiscal deficits (2.0% of GDP in 2023) would enhance investor confidence and attract foreign direct investment in export-oriented sectors.

Third, reforming trade policies, such as reducing tariffs and revising indigenisation laws, could lower export costs and improve competitiveness.

Fourth, leveraging the African Continental Free Trade Area (AfCFTA) and COMESA could expand market access for manufactures, which declined from USD 740 million in 2011 to USD 470 million in 2018.

Fifth, addressing infrastructure bottlenecks, particularly in rail and electricity, would reduce production costs, enhancing export viability.

Finally, promoting labour-intensive industries like textiles and horticulture could diversify exports, mitigate commodity price volatility, and create jobs, fostering sustainable trade balance improvements.

Therefore, Zimbabwe’s trade deficit widened in May 2025 despite export growth, driven by structural import dependency and a narrow export base.

Historical surpluses until 2000 contrast with persistent deficits post-land reforms, reflecting the need for agricultural revitalisation, industrial development, and policy reforms to achieve trade balance sustainability.

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