WORLD  TRADE  
ORGANIZATION  RESTRICTED 
WT/TPR/S/252 
14 September 2011  
 
(11-4340) 
Trade Policy Review Body  
   
 
  
 
TRADE POLICY REVIEW 
 
Report by the Secretariat 
 
ZIMBABWE 
 
  
 
This report, prepared for the second Tr ade Policy Review of Zimbabwe, has 
been drawn up by the WTO Secretaria t on its own responsibility.  The 
Secretariat has, as required by the Agreement establishing the Trade Policy 
Review Mechanism (Annex 3 of the Ma rrakesh Agreement Establishing the 
World Trade Organization), sought clarification from Zimbabwe on its trade 
policies and practices. 
 
Any technical questions arising from this report may be addressed to 
Jacques Degbelo (tel:  022 739 5583) and Rosen Marinov (tel:  022 739 6391). 
 
Document WT/TPR/G/252 contains the policy statement submitted by 
Zimbabwe. 
 
 
 
Note: This report is subject to restricted ci rculation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on Zimbabwe. Zimbabwe WT/TPR/S/252 
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CONTENTS 
 
  Page 
SUMMARY   vii 
I.  ECONOMIC ENVIRONMENT 1  
 (1)   MAIN FEATURES OF THE ECONOMY  1  
 (2)   RECENT ECONOMIC DEVELOPMENTS  3  
 (3)   TRADE AND INVESTMENT PATTERNS  6  
 (4)   OUTLOOK  10 
II.  TRADE AND INVESTMENT REGIMES 11  
 (1)   GENERAL FRAMEWORK  11  
 (2)   TRADE POLICY OBJECTIVES  14  
 (3)   TRADE AGREEMENTS AND ARRANGEMENTS  14  
 (i)   The WTO 14  
 (ii)   Regional agreements 15  
 (iii)   Bilateral agreements 17  
 (iv)   Other preferential agreements 17  
 (4)   INVESTMENT REGIME  17  
III.  TRADE POLICIES AND PRACTICES BY MEASURE 20  
 (1)   INTRODUCTION  20  
 (2)   MEASURES DIRECTLY AFFECTING IMPORTS  21  
 (i)   Procedures 21  
 (ii)   Goods in transit 23  
 (iii)   Rules of origin 24  
 (iv)   Customs valuation 25  
 (v)   Tariffs 26  
 (vi)   Prohibitions, quantitative restrictions, controls, and licensing 35  
 (vii)  Contingency measures 39  
 (viii)  Technical regulations, conformity assessment, and standards 39  
 (ix)   Sanitary and phytosanitary measures 40  
 (x)   Other measures 43  
 (3)   MEASURES DIRECTLY AFFECTING EXPORTS  43  
 (i)   Procedures 43  
 (ii)   Export taxes, charges, and levies 44  
 (iii)   Export controls and licensing 44  
 (iv)   Export finance, insurance, and guarantees 46  
 (v)   Export promotion and marketing assistance 47  
 (vi)   Other measures affecting exports 47  
(4)  MEASURES AFFECTING PRODUCTION AND TRADE  49  
 (i)   Incentives and other assistance to business 49  
 (ii)   Government procurement 52 
 (iii)   State-trading, state-owned co mpanies, and privatization 53  
 (iv)   Competition policy and price controls 55  
 (v)   Intellectual property rights 59 WT/TPR/S/252 Trade Policy Review 
Page iv 
  
    Page 
IV.  TRADE POLICIES AND PRACTICES BY SECTOR 62  
 (1)   INTRODUCTION  62  
 (2)   AGRICULTURE , LIVESTOCK , AND FORESTRY  63  
 (i)   Overview 63  
 (ii)   Agricultural policy 66  
 (iii)   Policy by subsector 69  
 (3)   MINING , ENERGY , AND WATER  79  
 (i)   Mining products 79  
 (ii)   Petroleum products 86  
 (iii)   Electricity 87  
 (iv)   Water 90  
 (4)   MANUFACTURING SECTOR  91  
 (i)   Overview 91  
 (ii)   Industrial policy 91  
 (iii)   Policy by subsector 93  
 (5)   SERVICES  96 
 (i)   Overview 96  
 (ii)   Financial services 97  
 (iii)   Post and telecommunication services 108  
 (iv)   Transport 110  
 (v)   Tourism 114  
V.  AID FOR TRADE 117 
 (1)   OVERVIEW  117  
 (2)   DEVELOPMENT STRATEGY  118  
 (3)   AID-FOR-TRADE SUPPORT  119  
 (i)   The Chirundu One Stop Border Post (OSBP) 119  
 (ii)   Trade-Related Technical Assistance (TRTA) needs 120  
 (iii)   Supply-side and infrastructural constraints 121  
REFERENCES   123 
APPENDIX TABLES  127 
 
  Zimbabwe WT/TPR/S/252 
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CHARTS 
  Page 
 
I. ECONOMIC ENVIRONMENT  
I.1 Main sectors of the economy, 2005-10 1 
I.2 Trade in goods and services, 2005-10 6 I.3 Structure of merchandise trade, 2005 and 2010 7 
I.4 Direction of merchandise trade, 2005 and 2010 8 
 III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
III.1 Breakdown of applied MFN tariff rates, 2011 29 III.2 Tariff escalation by ISIC 2-digit industry, 2011 30 
III.3 Number of tariff lines by share of rebates/suspensions in total imports, 2009 and 2010 34 
 IV. TRADE POLICIES AND PRACTICES BY SECTOR 
 
IV.1 Maize production and productivity trends, 1980 to 2010 74 
IV.2 Tariff protection in the manufacturing sector, 2011 95 
IV.3 Institutional relationship for the road sector 112 IV.4 Tourist arrivals to Zimbabwe, 1990-2009 115 
 
 
TABLES 
 
I. ECONOMIC ENVIRONMENT  
I.1 Selected macroeconomi c indicators, 2005-10 2 
I.2 Balance of payments, 2005-10 5 I.3 Approved investments, 2005-10 9 
 
II. TRADE AND INVESTMENT REGIMES  
II.1 Key trade-related legislation  12 
II.2 Notifications to the WTO, 2005-11 15  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
III.1 Tax revenue by main sources, 2005-10 26 
III.2 Structure of MFN tariffs, 2007 and 2011 27 III.3 Summary analysis of Zimbabwe's MFN tariff, 2011 28 
III.4 Products subject to excise duties, 2005-10 33 
III.5 Preferential (average) tari ffs and 2010 import shares 35 
III.6 Goods subject to import controls and/or licensing 36 
III.7 Import prohibitions and suspensions, 2005-11 38 
III.8 Goods subject to export controls and/or licensing 45 III.9 Export prohibitions and suspensions, 2005-11 46 
III.10 Tax incentives to business, July 2011 49 
III.11 Methods of inviting tenders, bids or proposals 53 III.12 Foreign currency ava iled to state-owned companies and parastatals, 2003-09 54 
III.13 Definitions of anti-competitive conduct and conditions for its admissibility 56 
III.14 Penalties for selected infringements of the Competition Act 58 III.15 Enforcement of the Competition Act, 2005-10 58 
III.16 Price controls, 2005-10 59 
 WT/TPR/S/252 Trade Policy Review 
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  Page 
IV. TRADE POLICIES AND PRACTICES BY SECTOR 
 
IV.1 Characteristics of Zimbabwe's natural regions 63 
IV.2 Production of food security and cash crops, 1996-2010 64 
IV.3 National distribution of land, 1980, 2000, and 2010 65 
IV.4 Cattle trends, 1991-2006 70 IV.5 Livestock population, 2009 70 
IV.6 Production and export of timber products, 2000-09 77 
IV.7 Areas under various land uses in Zimbabwe 77 IV.8 Minerals resources in Zimbabwe 80 
IV.9 Fuel storage capacity in Zimbabwe 87 
IV.10 Average daily electricity output MW/hr, 1996-2010 88 IV.11 Electricity capacities, as at September 2010 88 
IV.12 Structure of the banking sector, 2005-10 98 
IV.13 Maximum thresholds for bank charges, 2008 99 IV.14 Principal banking legislation 101 
IV.15 Ownership structure of banking institutions, 30 September 2010 103 
IV.16 Banking system performance, 2008-10 104 
IV.17 Zimbabwe road network 111 
  
APPENDIX TABLES 
 
I. ECONOMIC ENVIRONMENT 
 
AI.1 Merchandise exports and re-exports by groups of products, 2005-10 129 AI.2 Merchandise imports by groups of products, 2005-10 131 
AI.3 Merchandise exports and re-exports by trading partner, 2005-10 132 
AI.4 Merchandise imports by trading partner, 2005-10 133 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
AIII.1 Penalties for infringements of the Customs and Excise Act, 2011 134 AIII.2 Duty rebates and suspensions, 2005-10 135 
AIII.3 Applied MFN tariff averages by HS2, 2011 140 
AIII.4 State-owned enterprises and parastatals, July 2011 143 AIII.5 National IPR legislation and international agreements, 2011 148 
 
IV. TRADE POLICIES AND PRACTICES BY SECTOR 
 
AIV.1 Applied MFN tariffs, by ISIC Rev.2 category, 2011 150 AIV.2 Mining Commissioners fees structure, May 2009 153 AIV.3 Processing steps for exclusive prospecting orders 154 
AIV.4 Application for mining title 155 
AIV.5 Details required for application for mining title 156 
 
 Zimbabwe WT/TPR/S/252 
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SUMMARY  
 
1. Zimbabwe's renewed commitment to 
fiscal discipline and its de facto  adoption of 
the U.S. dollar as legal tender as a result of the 
implementation of its multi-currency system in February 2009 have brought some encouraging signs towards macroeconomic stabilization.  Nevertheless, Zimbabwe's 
economy is still in a fragile state with high 
unemployment, depleted international reserves, and unsustainably high external debt, including a major accrual of arrears.  A fractious socio-political environment, combined with a controversial land reform and 
measures in favour of indigenization, has 
triggered the withdrawal of support from the international community and cast a shadow over property rights, thereby undermining the business environment, with a devastating 
impact on Zimbabwe's economic performance 
and social indicators over the past decade. 
2. Zimbabwe's economy remains 
relatively diversified, with the services sector accounting for approximately half of its GDP. Despite its comparatively modest contribution 
to GDP, agriculture remains the principal 
source of employment and continues to have a multiplier effect on the economy.  The mining sector has recently entered a phase of vigorous expansion and has the potential to develop into 
a major pillar of the economy.  The 
manufacturing sector's GDP share has been on the decline, partly reflecting the drop in capacity utilization amid difficult macroeconomic conditions .  State ownership 
and intervention in the economy remain 
significant, rendering the supply of key goods and services inefficient and costly. 
3. Zimbabwe has lowered applied MFN 
tariff rates unilaterally, with a view to reducing production costs.  However, at 
15.4%, its simple average applied MFN tariff 
rate is among the highest in the region.  Besides ad valorem  tariff rates ranging from 
zero to 160%, some 6.1% of all lines carry non-ad valorem  tariffs;  due to lack of data, 
their ad valorem  equivalents could not be 
calculated.  Agriculture is the most protected sector, with an average applied MFN tariff rate 
of 25.1%, compared with 13.9% on non-agricultural products (WTO definitions).  Zimbabwe's MFN tariff rates on 61 lines 
exceed the corresponding bound levels (in 
some cases by as much as 60 percentage points), although its tariff bindings cover only 22.4% of all lines;  moreover, 64 lines carry non-ad valorem  rates that could potentially 
exceed their ad valorem  bindings. 
4. A range of other duties and charges 
may also be imposed on imports and/or exports.  Internal taxes (VAT and excise duties 
in particular) apply to imports and locally produced goods;  specific excise duties on 
tobacco products may differ depending on 
their origin.  Export bans/suspensions or taxes may apply to selected products on value-addition or self-sufficiency grounds.  Tariff suspensions are in place for a number of 
essential food items, and full rebates of the 
customs tariff and VAT may be granted for a variety of reasons;  the particular focus on inputs under some rebate schemes further increases the effective protection of selected industries. 
5. Zimbabwe is among the regional 
leaders in the deployment and upgrading of computerized customs clearance systems.  It levies customs duties on the c.i.f. value of imports, computed as an aggregate of all costs 
up to the point of entry into its customs 
territory.  The methodology for calculating the cost of freight in the absence of satisfactory documentary evidence provides for preferential treatment of shipments transported 
from some of its neighbouring countries, as 
opposed to those transported from any other African country.  In general, permits/licences are maintained on security, health, SPS, moral, and environmental grounds.  The documentation required for customs clearance 
often involves more than one competent 
authority, which may levy fees and charges independently. Administrative fees under the permit system for domestic and international trade in wild life specimens are calculated on 
an ad valorem  basis.  WT/TPR/S/252 Trade Policy Review 
Page viii 
  
6. Zimbabwe is a party to bilateral and 
regional trade agreements (SADC, COMESA), which overlap in terms of  trading partners but 
may differ in product coverage and regulatory 
stringency, including with respect to rules of 
origin.  The simple average tariff rates for Zimbabwe's preferential partners range from 0.2% (SADC excluding South Africa) to 11.4% (South Africa).  The continued 
relevance of membership in these overlapping 
agreements should be reviewed, as aggregate preferential imports remain rather modest at some 18% of total imports in 2010.  
7. Zimbabwe's Competition and Tariff 
Commission is responsible for investigating 
and correcting anti-competitive conduct on the 
domestic market;  it also plays an investigative role in trade remedies.  Due to delays in the updating of legislation, all mergers are currently subject to notification and thereby to 
a fee of 0.5% of the merging parties' combined 
annual turnover or combined value of assets in Zimbabwe;  the absence of notification fee ceilings often results in abnormally high levies.  The Commission has, on occasions, aligned merger control with broader policy 
objectives, including indigenization and local 
value-addition.  Zimbabwe has never initiated investigations nor imposed measures under its trade remedies legislation. 
8. Zimbabwe's procurement legislation 
provides for a 10% price preference to 
suppliers whose operations have locally channelled downstream and social benefits, as well as to "previously economically disadvantaged" suppliers.  The administration 
of public procurement has been undermined 
by resource constraints and the impact of hyperinflation, which had caused frequent valuation adjustments and eroded the deterrence effect of penalty provisions. 
9. Efforts to bring Zimbabwe's 
intellectual property regime into closer 
conformity with the provisions of the TRIPS Agreement have translated into a number of legislative amendments, most of which entered into force in 2001-04.  Zimbabwe recognizes 
patent, industrial design, and trade mark applications filed through the African 
Regional Intellectual Property Organization (ARIPO) to which it is a party;  ARIPO trade mark registrations were  given national effect 
formally in 2010. 
10. Agriculture is the leading sector in 
Zimbabwe's poverty-reduction strategy owing to its labour intensity, and its role in food security (mainly through self-sufficiency in 
main foodstuffs and subsistence farming) and 
as a supplier of inputs to local industries.  Agriculture remains heavily protected and supported, including through high tariffs and a price band system.  However, the sector's development remains hampered by numerous 
factors such as the Fast Track Land Reform 
Programme (FTLRP), erratic weather, limited access to and high costs of financing, and infrastructure bottlenecks.  Lack of security of 
tenure, aggravated by the FTLRP, has 
negatively affected investment in the sector, causing large-scale underutilization of land.  
11. Despite the recent adoption of 
indigenization and empow erment regulations, 
mining has remained a preferred sector for 
foreign investment in Zimbabwe.  Although it has immense potential, it still makes a 
marginal contribution to growth.  Mining 
imports are subject to an average tariff rate of 5.9% for the extractive industries but the inclusion of various surcharges raises the average border charge to 31.3%.  Lack of clarity over the mining royalty and taxation 
systems is another source of concern for 
investors.  Mining activities are subject to a fixed permit issuing fee,  royalties based on the surface area being worked, an extraction tax that varies with the nature of the substance 
being mined, an ad valorem  tax, and a 
multitude of other taxes and charges.  Unprocessed chrome ore is subject to an export ban (occasionally replaced by an export tax).  The Minerals Marketing Corporation of Zimbabwe, wholly owned by the State, acts as 
the exclusive agent for the marketing and sale 
of all minerals produced in Zimbabwe. 
12. By African standards, Zimbabwe's 
manufacturing sector is relatively large and Zimbabwe WT/TPR/S/252 
 Page ix 
 
 
well-diversified.  It has strong direct linkages 
with the other sectors of the economy, particularly agriculture to which it previously supplied 50% of its output in the form of 
fertilizers, feed-stock, and insecticides.  The 
sector's performance has deteriorated in line with the decline in economic activities over the past ten years, losing almost 50% of its output.  The industry faces international 
competitiveness challenges due to its relatively 
high production costs, old plants and equipment, unreliable supplies of and exorbitant tariffs for key utilities (electricity, water, fuel, and coal), lack of financing, and working capital eroded by hyperinflation.  In 
addition to import duties and charges, other 
trade policy measures affecting the sector include the duty drawback and inward processing rebate schemes, import and export licensing, and tariff and tax concessions on 
various imported inputs and capital goods.  
The average tariff protection for manufactured products is 15.4%, with tariff rates ranging up to 140% in industries including food products, beverages, wood and wood products, and tobacco. 
13. Zimbabwe is a net importer of 
services;  its main export is travel (tourism) services, while imports have been dominated by transportation services, reflecting its remoteness from key markets.  A range of 
services are provided ( de facto  or de jure ) 
exclusively by state-owned enterprises.  Zimbabwe faces serious challenges in restructuring and recapitalizing state-owned companies whose performance has 
deteriorated significantly due to the severe economic conditions of the past decade.  
Zimbabwe's banking and insurance subsector has struggled considerably during the economic crisis; several insurance companies 
and banks have gone bankrupt.  Since 2010, 
all undercapitalized institutions have been de-registered by the Government.   
14. Zimbabwe's specific commitments 
under GATS are limited and cover only 
financial services (insurance and insurance-
related services;  and banking and other financial services);  tourism;  and telecommunication services.  Its Schedule includes some horizontal restrictions on market access.  Zimbabwe did not participate 
in the extended negotiations on basic 
telecommunications or financial services or otherwise upgrade its GATS commitments. 
15. Zimbabwe's relations with major 
donors and lenders remain far from perfect, 
and it has had virtually no major development 
assistance since 2000, except for humanitarian aid.  So far, Zimbabwe has benefited from Aid for Trade in the context of a regional project under COMESA – the Chirundu Open Border Post project.  Its main TRTA needs are in:  
developing a trade remedies knowledge base;  
tariff analysis;  intellectual property rights enforcement;  WTO notifications;  upgrading trade reference and other information centres;  and training and upgrading national quality 
infrastructure systems at the Standards 
Association of Zimbabwe, in order to fulfil TBT and SPS obligations and enforce quality standards.