WORLD TRADE  
ORGANIZATION  RESTRICTED 
WT/TPR/G/252 
14 September 2011  
 
(11-4338) 
Trade Policy Review Body Original:  English 
   
 
  
 
TRADE POLICY REVIEW 
 
Report by 
 
ZIMBABWE 
 
  
 
Pursuant to the Agreement Establishi ng the Trade Policy Review Mechanism 
(Annex 3 of the Marrakesh Agreement Establishing the World Trade 
Organization), the policy statement by Zimbabwe is attached. 
 
 
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/G/252 
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  CONTENTS 
 
  Page 
(1)  INTRODUCTION 7 
(2)  MACROECONOMIC  ENVIRONMENT 8  
 2.1   Overview of economic developments 8  
 2.2   Performance of the economy 9  
 2.3   Sectoral performance 10  
(3)  INSTITUTIONAL  AND  STRUCTURAL  REFORMS 17  
 3.1   Agriculture 17 
 3.2   Mining  17 
 3.3   Manufacturing 18  
 3.4   Services  19 
 3.5   Others  20 
(4)  TRADE  POLICIES  AND  PRACTICES 23  
 4.1   Trade policy objectives 23  
 4.2   Import and tariff regime 23  
 4.3   Export policy 24  
 4.4   Investment regimes 24  
 4.5   Sanitary and phytosanitary (SPS) measures 25  
 4.6   Intellectual property rights (IPRs) 26  
(5)  TRADING  ARRANGEMENTS 26  
 5.1   Regional trading agreements 26  
  5.2   Multilateral commitments 28  
 5.3   Aid for Trade 29  
(6)  MEDIUM-TERM  OUTLOOK 29  
 
 Zimbabwe WT/TPR/G/252 
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LIST  OF ABBREVIATIONS 
ACP African, Caribbean and P acific (Group of countries) 
AMA Agricultural Marketing Authority BIPPAs Bilateral Investment Promotion and Protection Agreements  COMESA Common Market for Eastern and Southern Africa CAAZ Civil Aviation Authority of Zimbabwe COMEZ Commodity Exchange in Zimbabwe CTC Competition and Tariff Commission DiMAF Distressed and Marginalised Areas Fund EITI Extractive Industries  Transparency Initiative 
EPA Economic Partnership Agreement ESA Eastern and Southern Africa  EU European Union  FDI Foreign Direct Investment FTA Free Trade Area GATT General Agreement on Tariffs and Trade GDP Gross Domestic Product GPA Global Political Agreement GPW Gross Premium Return GSTP Global System of Trade Preferences ICT Information Communication Technology IDP Industrial Development Bank IDP Industrial Development Policy IPRs Intellectual Property Rights  MTP Medium Term Plan NOCZIM National Oil Company of Zimbabwe NTBs Non-Tariff Barriers NTP National Trade Policy OGIL Open General Import Licence POTRAZ Postal and Telecommunications an d Regulatory Authority of Zimbabwe WT/TPR/G/252 Trade Policy Review 
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  PPPs Public-Private Partnerships  
RBZ Reserve Bank of Zimbabwe  RECs Regional Economic Communities  RETOSA Regional Tourism Organisation of Southern Africa SADC Southern Africa Development Community SAZ Standards Association of Zimbabwe  SME Small and Medium Enterprises SPS Sanitary and Phytosanitary Measures STERP  Short-Term Emergency Recovery Programme TBT Technical Barriers to Trade 
VAT Value Added Tax 
WTO World Trade Organisation ZERC Zimbabwe Electricity Regulatory Commission ZESA Zimbabwe Electricity Supply Authority ZETREF Zimbabwe Economic and Trade Revival Fund ZIA Zimbabwe Investment Authority ZIDERA Zimbabwe Democracy and Economic Recovery Act 
ZIMRA Zimbabwe Revenue Authority ZIMTRADE  Zimbabwe National Trade Promotion Organisation  ZSE Zimbabwe Stock Exchange 
 
   
 
     
 Zimbabwe WT/TPR/G/252 
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  (1) INTRODUCTION 
1. Since its last Trade Policy Review in 1994, Zi mbabwe experienced significant developments 
of both socio-economic and political nature that have impacted on bot h formulation and application of 
its Trade Policy. On the socio-economic front, the imposition of sanctions by sections of the 
international community has massively imp acted negatively on the Zimbabwean economy . The 
sanctions include the enactment  of the Zimbabwe Democracy  and Economic Recovery Act 
(ZIDERA) in 2001 by the United States of America (USA), sanctions by the European Union (EU) in 
2002 as well as Canada and Australia and their allies .  
2. Not only have the sanctions resulted in the suspension of the budgetary support previously 
provided by the EU and other donors and the w ithdrawal of support by  multilateral financial 
institutions in accordance with the ZIDERA, but have also led to bilateral creditors and donors 
reducing or suspending disbursements on existing loan s to the Government and parastatals. Except for 
humanitarian aid, Zimbabwe has received virtuall y no development assistance since the year 2000. 
3. This development caused Zimbabwe to adop t a forced inward looking policy whose 
application may have been inconsistent with the central tenets of our commitments to the WTO and 
other multilateral organizations.  
4. The period was characterised by a highly unstable macroeconomic environment with 
hyperinflationary rates reaching 231 million per cent in July 2008, severe shortages of basic utilities 
including electricity, fuel, water, most basic food and non-food commodities, massive decline in 
agricultural production (due to non-availability and de lays in input deliveries to farmers as well as 
recurrent droughts, foreign currenc y shortage, quasi-fiscal operations and loss of skilled labour).  
Price controls and an overvalued exchange rate regime, low capac ity utilisation, transport problems 
and the negative publicity the country was facing cont ributed to the general decline of the economic 
activities.   
5. Sectorally, on the trade front, application of this policy experience contributed to the 
persistent capital account deficits and reduced fore ign currency capital inflows which led to pressures 
on foreign exchange reserves. This resulted in diffi culties for the Government in raising resources to 
finance critical imports such as grain, drugs, raw materials, fuel and electricity. For a country that has to import 100% of its fuel and 40% of its electric ity, the scarcity of fuel and electricity severely 
impacted industrial production wh ich fell to below 10% of capacity  by 2008, with the additional 
inability to import essential spare parts and raw materials. 
6. On the political front, the signing of th e Global Political Agreement (GPA) in 
September 2008 creating the Inclusive Government sh ifted the policy focus from inward to outward 
looking and more in line with our multilateral commitments under the WTO. Since 2009, a number of 
controls on investment, imports and exports have been removed supported by a raft of policy 
measures. Effective and successful implementation of these policies will thus need to be also 
supported by reciprocation from our trading partners  in the form of removing sanctions that have 
literally chocked the country's access to affordab le bilateral and multilate ral funding critical for 
industrialization and export led growth.  
7. These recent developments have also shaped th e vision for Zimbabwe as enshrined in the 
Medium Term Plan (MTP):  2011-2015, which pr ovides a compendium of the policy framework, 
projects, investment opportunities and programmes d esigned to create an economic environment that WT/TPR/G/252 Trade Policy Review 
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  enables the participation of all players in the econom y, with a view to contribute to the achievement 
of the goals and objectives set out in the plan.  
8. The plan, among other objectives, seeks to achie ve broad based economic growth, increase 
economic empowerment, create decent  jobs and improve the economic and social well-being of the 
Zimbabwean people. The MTP responds to the manda te set out in Article 3 of the Global Political 
Agreement (GPA) to support the restoration of economic stability and growth in the country, and 
builds on the foundation laid by the Short Term Emergency Recovery Progr amme (STERP) launched 
in 2009, which embraces political and governance issues, social protection and the stabilisation 
programme as key priority areas.  
9. During the decade 1998-2008, the economy was face d with a number of complex challenges 
which were exacerbated by droughts, other natural disasters and the global food and energy crisises.  
10. The Real Gross Domestic Product (GDP) cumu latively declined by over 50% during the 
period 2000-2008. For the period 2001-2006, the average annual GDP declined by 5.7%. 
11. Since 1980, the manufacturing sector has been the major driver of the economy contributing 
about 20% of GDP on average while agriculture contributed 16%. However, by 2006 manufacturing 
had declined to 15% while the sh are of agriculture reached 17% of GDP. The contribution of the 
mining sector remained fairly stable at 4% of the GDP. The three sectors recorded decline in output, 
with agriculture, manufacturing and mining estimated  to have declined by 7.3%, 73.3% and 53.9% 
respectively in 2008. Performance in other sectors fo llowed the same declining trend. Overall, output 
declined by more than 40% for the period 2000-2008. 
12. The agriculture and manufacturing sectors have  been the main contributors to export 
earnings;  however these have been overtaken by th e mining sector which currently contributes nearly 
50% of total exports. 
13. Against this background, poverty and unemp loyment reached unprecedented levels. The 
provision of adequate and quality basic social se rvices was severely affected, which hampered 
progress towards the attainment of the Millennium  Development Goals (MDGs). The provision and 
delivery of social services, particularly health and education, was compromised due mainly to the 
unprecedented deterioration of infrastructure, lo ss of professionals and shortages of drugs and 
equipment. Despite these developments, the HIV/AIDS  prevalence rate which had reached 27.2% in 
1998 declined to 14.3% in 2010 as a result of the intensified awareness campaigns and preventive 
measures adopted.   
14. The high unemployment levels, especially among the youths, remains a major challenge in 
the development process to support the restoration of economic stability and growth.  
(2) MACROECONOMIC  ENVIRONMENT 
2.1 Overview of economic developments 
15. The country experienced phenomenal exchange rates and unprecedented hyperinflation levels 
during the period 2005-2009. The macroeconomic environment under which the country operated 
during the period presented enormous economic challe nges. At the epicenter of the economic crisis, 
were unprecedented levels of hyperi nflation, sustained periods of ne gative GDP growth rates, massive 
devaluation of the currency, low productive cap acity, loss of jobs, food shortages, poverty and 
massive de-industrialization.  Zimbabwe WT/TPR/G/252 
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  16. After embracing STERP and the multicurrency regi me in 2009, inflation dramatically fell to 
single digit levels and stabilized at below 5% by e nd of year. Capacity utilization in the manufacturing 
sector increased from about 10% to 40% and GDP  per capita increased from US$403.1 in 2007 to 
US$499 in 2010. Implementation of an austerity budget and monetary policies have brought about 
macroeconomic stabilisation and improved the socio-political system.  
2.2 Performance of the economy 
17. The negative real GDP growth rate trend c ontinued during the period under review. The 
growth rates were 4.1% in 2005, 3.5% in 2006, 3.3% in 2007 and 1.4% in 2008. During the period 2000 to 2008 the trade account as a percentage of the GDP was volatile due to the prevailing  
exchange rates. After the adoption of the multic urrency regime in 2009, the economy recorded 
positive growth rates of 5.7% and 8.1% in 2009 a nd 2010 respectively. The projected growth rate for 
2011 is 9.3%.  
18. The GDP at market prices was US$5.6 billion in 2005, US$5.2 billion in 2006, US$5 billion 
in 2007, US4.2 billion in 2008, US$5.6 billion in 2009 and US$6.7 billion in 2010.  This translates to 
GDP per capita of US$447.6 in 2005, US$417.6 in 2006, US$403.1 in 2007, US$340.7 in 2008, 
US$449.2 in 2009, and US$499 in 2010. 
19. The positive growth rate in GDP is largely a result of policy measures instituted following the 
formation of the Inclusive Govern ment in February 2009. The c onsistent implementation of these 
policies, which included adoption of a multicurrenc y regime, cash budgeting by the fiscus as well as 
other liberalisation measures, such as the removal of  price controls and quasi-fiscal operations led to 
the stabilisation of the economy.  
20. Revenue as a percentage of GDP increased from 29% in 2000 and peaked at 633.1% by 2007. 
Expenditure as a share of GDP grew from 50.4% in 2000 and over 1,300% in 2007. During the same period, budget deficit worsened from 22.5% in 2000 and over 700% in 2007.  
21. Due to the effects of hyperinflation in the period from mid 2000, Zimbabwe's domestic debt 
to GDP declined significantly from 41.4% in 1980 to 31.9% in 1990 and 9.3% in 2007. The inflation 
unleashed by the printing of money reduced the r eal value of the bonds held by debt holders. 
22. Exports were slowly growing during the peri od under review from US$1.5 billion in 2005 to 
US$1.7 billion in 2007 and US$2 billion in 2009. Exports significantly increased in 2010 to US$2.5 billion and are expected to reach US$2.8 bill ion in 2011. Imports continued to rise owing to 
the reduced domestic production and shortage of basic commodities during the same period. Imports 
increased from just under US$2 billion in 2005 to US $2.6 billion in 2008, US$3.7 billion in 2009 and 
US$4 billion in 2010.  Total trade as a percentage  of GDP was fluctuating during the same period 
from 122.6% in 2005 to 98.3% in 2007 and 127.2% in 2010. 
23. Exports are forecasted to increase at a faster ra te than growth in the rest of the economy 
reflecting dominance of the mining sector. The growth  in the exports will be as a result of growing 
opportunities in the regional markets. 
24. The economy has been saddled by a growing Bala nce of Payments (BOP) deficit for the last 
decade. The deficit peaked at US$1.8 billion in 2009, declining to US$463 million in 2010 and is 
expected to further decline to US$388 million in 2011.  WT/TPR/G/252 Trade Policy Review 
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  25. Very high inflation levels were experienced dur ing the period under review with the official 
annual inflation rate reaching 231 million per cent and monthly inflation at 1,800% in July 2008. 
Inflation drivers during the period were quasi-fi scal operations which saw the Reserve Bank of 
Zimbabwe (RBZ) printing money to finance govern ment operations, subdued growth in industrial 
capacity utilisation as well as increases in oil prices and soaring world food prices. Major factors were 
food and non-alcoholic beverages, alcoholic beve rages, clothing and footwear, utilities, household 
equipment, furniture and transport. 
26. Inflation has been stable from 2009 after th e adoption of the multicurrency regime. The 
average annual inflation for 2009 and 2010 was 7.7%  and 4% respectively. In 2011, inflation 
continues to slow down and if the current inflation trend continues, the country is set to achieve a 
lower average inflation rate below the 4.5% projection.  
2.3 Sectoral performance 
2.3.1 Agriculture 
27. Agriculture plays a pivotal role in the Zi mbabwean economy and has the potential to 
significantly reduce poverty, enhance economic grow th and entrench economic stability. The sector 
provides employment and income for about 70% of  the population, supplies 60% of raw materials 
required by the industrial sector and contributes 40% of total export earnings. The sector is estimated to contribute between 15% and 18% of GDP.  
28. Agricultural production constitutes mainly of crop and livestock production. Major crops 
grown include maize, cotton, wheat , tobacco, sugar, horticultural products, small grains and oilseeds. 
Livestock production consists of cattle, goats, sheep, pi gs and poultry. Output declined dramatically 
over the past one and half decade, resulting in a reve rsal of the country's prestige status from being the 
largest net exporter of food in the Southern African region, to that of a net food importer. Total maize 
production declined from a peak of 2,057,000 tonnes in 1996 to 1,328,000 tonnes in 2010 against a national requirement of 1,800,000 tonnes. Wheat production declined from a peak of 263,000 tonnes in 1996 to 41,000 tonnes in 2010. 
Production of food security crops, 1996-2010 
(in '000 tonnes) 
Crop 1996 1998 2000 2002 2004 2006 2008 2010 
Maize 2,065 1,995 1,545 605 1,400 1,485 575 1,328 
Wheat 263 242 229.8 195 247 241 34 41 
Soya bean 97 116 99 84 86 70 48 70 
Sorghum 90 39 84 22 129 101 75 132 
Sunflower 28 142 18 5 20 20.8 5 14 
Ground nuts 68 46 114 59 150 83 131 186 
 
29. Production of major cash crops also register ed significant decline. Tobacco production 
dropped from 226,000 MT in 1998 to 123,000 MT in 2008 and then further declined to 122,000 MT 
in 2010. Cotton production has been fluctuating downwards having declined from 229,000 MT in 
1996 to 190,000 MT in 2002, peaking at 333,000 MT in 2004 before declining to 260,000 MT in 2010. Horticultural production also followed the same  trend declining from a peak of 82,000 MT in 
2002 to 43,000 MT in 2010.  
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  Production levels for cash crops, 1996-2010 
(in '000 tonnes) 
Crop 1996 1998 2000 2002 2004 2006 2008 2010 
Tobacco 178 226 198 173 68 55 56 123 
Cotton 229 274 304 190 333 260 226 260 
Horticulture 41 54 64 82 57 64 60 43 
 
30. In the livestock sector, the dairy herd was most affected with the dairy herd declining from 
100,000 cows in 2000 to about 22,000 in 2010.  
31. The decline in production levels  and productivity in the agricultural sector was mostly due to 
continued disruptions on agricultural activities as a result of conflicts betwee n former farm owners 
and allocated beneficiaries holding land offer letters following the implementation of the Land 
Reform Programme in 2000;  critical shortage of  inputs;  adverse weather conditions;  plant and 
animal diseases;  poor and dilapidated irrigation infra structure and inadequate financial support for the 
agrarian reform and loss of skilled labour, especially  to neighbouring countries. Investment in the 
sector was negatively affected by lack of security of tenure. 
32. Zimbabwe is working towards consolidating th e Land Reform Programme by implementing a 
comprehensive transparent land audit for the purposes of establishing accountability, addressing 
gender equity, eliminating multiple  farm ownerships, improving inputs supply and delivery, funding 
facilities, capacity building and extension services, in order to restore productivity as well as build investor confidence into the agricultural sector.  
33. Agriculture production is projected to grow by an average of 11% over the MTP period with 
the aim of restoring yields to the 1990s levels.  
2.3.2 Manufacturing Sector 
34. Zimbabwe's manufacturing sector is relatively large and well-diversified partly due to the 
import-substitution policies pursued before and af ter independence in 1980. The sector possesses 
strong direct linkage with the agricultural sector. Major manufacturing industries include 
agro-processing, clothing and textiles, metals, wood and furniture, fertilizer, cement, packaging, 
beverages, chemicals, among others.   
35. Between 1980 and 1990 the manufacturing sector acc ounted for 15% of formal employment 
and contributing up to 25% to GDP. The performan ce of the sector declined by more than 50% 
between 2000 and 2008 due to foreign currency shortages, lack of funding for capitalization purposes, 
price distortions arising from price controls and hyperinflation, influx of  cheaper imported goods, 
unreliable utility and energy supplies (electricity, wate r, fuel, coal) and recurrent droughts.  Capacity 
utilization fell dramatically reaching 10% in 2008. 
36. The manufacturing sector is slowly recovering w ith the sector having grown by a mere 3% in 
2010 after a decade-long de-industrialization experi ence. Growth in the manufacturing sub-sectors 
such as foodstuffs (0.5%), textiles and ginning (0 .4%), chemical and petroleum products (0.3%), 
paper, printing and publishing (0.2%), and other manufactured goods (0.1%), remained subdued. For 
other sub-sectors such as clothing and footwear, metals and metal products, and transport equipment, 
output is estimated to have declined by 0. 4%, 1.4% and 0.4% respectively, in 2010. WT/TPR/G/252 Trade Policy Review 
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  37. Currently, the local manufacturing industry faces international competitiveness challenges 
due to high production costs related to antiquated plan ts and equipment, power shortages, and lack of 
working capital, among others. Due to industrial cap acity utilisation and supply-side challenges, the 
economy has been absorbing disproportionately larg e amounts of imports of finished goods, further 
threatening the survival of the local industry. Th e loss of skills and the lagging behind of training 
institutions has exacerbated the labour market.  The private sector was also not investing in human 
capital development thus affecting the producti on of goods and services. However, with the 
implementation of the Industrial Development Po licy (IDP) (2011-2015), the manufacturing sector is 
expected to rebound and contribute close to 50% of export earnings by 2015.  
38. In this regard, the Government has identif ied and prioritized four sectors, namely 
agro-processing (food and beverages, clothing and textiles, wood and furniture), fertilizer industry, pharmaceuticals, and metals & electrical to stimulate the manufacturing sector, taking into account the contribution of the sectors to GDP, employment, export earnings, potential for value-addition, and linkages with other sectors of the economy. 
39. The growth of the sector is projected to average 5% per annum during the IDP period. 
2.3.3 Mining 
40. The mining sector has the capacity and potentia l to enhance economic growth and value 
addition. The sector has forward and backward li nkages with many sectors of the economy, including 
manufacturing, small and medium industr ies, construction and infrastructure. 
41. Mining currently accounts for nearly 50% of total exports and is a major recipient of Foreign 
Direct Investment (FDI). The sector however has be en performing below its potential. Its contribution 
to the GDP for the period under review averaged  4.2%. Skewed macroeconomic policies which 
included extended periods of overvalued exchange ra te and unsustainable fo reign exchange surrender 
requirements at 75%, adversely affected invest ment in the mining sector. Output declined 
significantly during the period 1996-2009 particularly gold output. 
42. The mining sector has the capacity to sustain double digit growth but is faced with a number 
of challenges that impede its faster recovery. Th e key challenges facing the sector are frequent power 
outages;  shortage of funds for working capital and recapitalization;  skills flight;  dilapidated and 
inefficient infrastructure. Mining continues to lose production time through unscheduled electricity outages, as the country grapples with power shor tages compounded by the regional energy demand 
that far outstrips supply. Shortages of funds for recapitalization and working capital finance remain a 
huge challenge for the sector which is struggling to secure reliable resources for long-term capital 
finance.  
43. The domestic economy does not have sufficient cap acity to provide adequate resources to the 
sector which has resorted to internally generated f unds as well as off-shore debt financing or working 
capital requirements. In addition, the absence of a clear exploration policy has made it difficult for 
potential mine exploration for which resources are difficult to secure for the mining exploration 
activities. In view of the above challenges, G overnment is working on the finalization of the 
amendment of the Mines and Minerals Act to ensure  the efficient exploration of mineral resources. 
44. The growth rate of the sector is expected to increase to 44% in 2011 and gradually decline to 
8% in the final year of the MTP period. Growth  is premised on the key assumptions of new capital 
injections;  firming international commodity prices;  improved power supply, investment 
environment, access to credit lines;  and the exploration of new mining areas. Zimbabwe WT/TPR/G/252 
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  45. The revival of the mining sector presents vast opportunities both in mineral extraction and 
value addition. Policies and initia tives to increase beneficiation and value addition for all major 
minerals including gold, platinum, nickel, copper,  coal, coke and other various non-ferrous ores are 
being implemented or developed. These will spell out the strategies for minerals value addition and 
beneficiation activities, royalties, minerals resour ce management and the adoption of the Extractive 
Industries Transparency Initiative (EITI). However,  penalties for the exportation of raw minerals 
where there is potential for value addition will be imposed. Government will also develop the 
Diamond Act and Policy with a view to encourag e the processing of diamonds prior to export. 
Government will also continue to work on improvi ng accountability and transparency with regards to 
the exploitation of diamonds in the country. 
2.3.4 Services Sector 
2.3.4.1 Overview of the Services Sector in Zimbabwe  
46. The services sector represents the largest sector in  Zimbabwe contributing more than 60% to 
GDP but very little in terms of export earnings. The industries within this sector include tourism, 
finance, education, health, energy, transpor t, telecommunications, construction and related 
engineering services, and infrastructure. The contribution of transport and communications to GDP is 
growing tremendously, having risen from 8% in 2000 to 15.2% in 2009. The tourism sector alone 
traditionally contributed around 6% to GDP and 10 % to foreign exchange earnings. The financial 
services sector in Zimbabwe is well developed, and includes the Zimbabwe Stock Exchange (ZSE), 
banking and insurance sectors. The ZSE is one of th e leading stock markets in Africa. The education 
sub-sector is also advanced in developing human ca pital. According to 2010 UN standards, Zimbabwe 
is ranked first in Africa with a literacy level of over 90%. 
47. Zimbabwe has comparative advantage in a number of services sectors which include 
construction, tourism, transport and communica tion and certain professional categories. The 
comparative advantage will be further explored to realize the potential offered by these sectors. 
2.3.4.2 Zimbabwe's Commitments on Trade in Services 
48. At the multilateral level (during the Uruguay Round of trade negotiations), Zimbabwe opened 
up three services sectors namely financial, tourism and communication services. At the regional level, 
Zimbabwe adopted the COMESA Regional Regulati ons governing Trade in Services in June 2009.  
Priority sectors for liberalization are tourism, financial, communication and transport. 
49. The Government will develop a national strate gy to promote the export of services and to 
harness the country's comparative advantage in th e sector. Zimbabwe's advanced infrastructure has 
potential for the country to gain from internationa l trade in services such as banking, insurance, 
telecommunications, health, education and transpor t. For tourism, the Government is currently 
developing a National Tourism Policy to  guide the sector's development.  
50. Government realizes the need for a strong re gulatory framework to be established as well as 
strengthening the existing ones.  
2.3.5 Transport 
51. Zimbabwe has one of the largest road and ra ilway networks in Southern Africa and is 
strategically positioned to provide a gateway to markets in the region. The transport network 
comprises of roads, rail and air with the public sect or being the main provider of the infrastructure WT/TPR/G/252 Trade Policy Review 
Page 14 
  
  services, given the historical minimal participation of the private sector in the provision of 
infrastructure. Zimbabwe's road network has a tota l length of 85,208 km, of which 20.4% are surfaced 
roads, 14% are gravel roads and 65% are earth roads.  
52. The economic challenges that the country faced have led to the deterioration of the basic 
infrastructure, including the transport sector, whic h in turn negatively impacted on other productive 
sectors of the economy as well as the level and quality of services. The low levels of periodic and routine maintenance of the transport infrastructure over the past decade has substantially contributed 
to the deterioration in the infrastructure. Over 44, 000 km of the country's road network has outlived 
its lifespan and requires major rehabilitation works.  
53. Some of the major challenges facing the transpor t sector include skills flight, long project roll 
out lead times, destruction of roads by overload ed heavy goods vehicles, lack of an integrated 
approach in transport policy formulation and inadequate funding for projects.  
54. In view of the above challenges, Governme nt introduced toll gates in 2009 which are 
facilitating the mobilization of resources for reha bilitation and maintenance of the road network. 
Government is also engaged with potential priv ate sector investors under the Public Private 
Partnership Framework for rehabilita tion and maintenance of roads. 
55. The rail track infrastructure, signaling and tel ecommunication system has deteriorated due to 
lack of regular maintenance resulting from financial c onstraints. As a result, there has been a massive 
deterioration of traction and rolling stocks. These ch allenges, coupled with the low economic activity, 
have negatively impacted on rail capacity utilizatio n. The rail system has the capacity to move a 
tonnage of 18 million annually. There has been a sharp decline in the average tonnage moved from 
12 million between 1995 and 1999 to 5 milli on during the period 2000 to 2010.  
56. In view of the challenges in the rail sector, Gove rnment is working towards the review of the 
regulatory framework governing railway transport. Government also has a policy for concessioning of 
sections of the track to allow private sector participation. 
57. Air transport is critical in promoting the grow th of tourism, high-va lue exports and imports 
and perishable products. The state-owned airline is  the provider of cargo and passenger services with 
a total fleet of eight aircrafts. Some of the major ch allenges include an aged fleet, which is costly to 
maintain, very low capitalization, poor ma intenance and inefficient management. 
58. Some progress has been made in the rehabilita tion and upgrading works at the country's 
three international airports through Public Private Partnerships.  
2.3.6 Financial sector 
59. The sector grew by 5.7% and 8.1% in 2009 and 2010 respectively and is expected to grow by 
9.3% in 2011 as a result of policy measures impl emented by Government in 2009. These measures 
include the adoption of a multicurrency regime, cash budgeting by the fiscus, removal of price 
controls and distortions and quasi-fiscal operations.  
60. Interest rates have largely remained unchange d since the introduction of the multicurrency 
system. Bank deposit rates have remained depressed between 0.5% and 5%. Lending rates continue to 
vary widely between financial institutions ranging between 8% and 60% depending also on tenure of 
the loans.  Zimbabwe WT/TPR/G/252 
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  61. Inflation has been stable since 2009. The aver age annual inflation for 2010 was 4% and is 
expected to slow down in 2011 and register an aver age rate lower than the projected rate of 4.5%. 
62. Zimbabwe boasts of a diversified banking sector which includes 27 banking institutions, 
16 Asset Management Companies and 114 microfin ance institutions under th e supervision of the 
RBZ. The banking sector in Zimbabwe has undergone a dramatic transformation in 2010, largely due 
to the restoration of the RBZ as the lender of last  resort, among other Government initiatives. Overall, 
the banking system remains sound, although the sector still faces some challenges related to 
under-capitalisation of some banks, rising non-performing loans, short-term nature of deposits as well 
as loopholes in the regulatory system.  
63. The Zimbabwe Stock Exchange, which plays an  integral part in mobilizing investment 
resources, has also improved its performance sin ce the introduction of the multicurrency system. 
64. Challenges and constraints are still being felt as re flected in the low market liquidity, lack of 
long term finance and high lending rates.  
65. The policy objectives currently being pursued by Government are aimed at achieving lower 
and competitive interest rates, increase access to financial services for the currently underserved 
segments of the economically active population, in particular the informal sector, SME and micro 
enterprises and the rural and agricultural sector s. The policy objectives also include greater 
mobilisation of local financial resources toward s productive activities, through deepening of the 
activities of banks, non-banks financial in stitutions and the capital markets.  
66. Government will pursue financial sector refo rms that revolve around a three-pronged policy 
strategy that focuses on the promotion of policies th at seek to achieve macroeconomic stability, foster 
the pursuance of market-determined interest rat es and implementation of the amended RBZ Act to 
enforce prudent banking practices through effective supervision. 
2.3.7 Tourism 
67. Tourism remains one of the most exciting and progressive industries in Zimbabwe. 
Government has identified it as one of the strate gic sectors for economic growth and development. 
The sector has linkages with other industries and makes a significant contribution to GDP, 
employment, investment and export earnings. The sector’s contribution to GDP is about 6%. 
68. Zimbabwe is best known for housing one of th e Seven Wonders of the World, the mighty 
Victoria Falls. The country also boasts of being one of  Africa's best Safari locations and is home to 
the Great Zimbabwe, Hwange National Park, Gonar ezhou National Park, Lake Kariba, Mana Pools 
and the Eastern Highlands, most of wh ich are UNESCO World Heritage sites. 
69. The sector faced a major decline in 2008 which saw tourist arrivals dropping to 1.8 million 
from 2.5 million in 2007. The sector is however, on a recovery path with the years 2009 and 2010 
having recorded an increase in arrivals of 2 million and over 2.5 million respectively. The upward 
trend is expected to continue over the MTP peri od mainly due to aggressive marketing campaigns 
being undertaken by the Government. 
70. The main challenges and constraints in the sect or, include negative publicity, skills flight, 
poor state of roads;  poor maintenance of infrastruct ure, water and electricity shortages;  few direct 
flights to and from source markets;  shortage and high cost of utilities which renders tourism 
uncompetitive regionally. WT/TPR/G/252 Trade Policy Review 
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  71. Government is implementing various measu res to enhance tourism promotion and 
development through image enhancement and rebrandi ng, marketing, upgrading and diversification of 
the tourism product, streamlined customs and i mmigration formalities and promotion of domestic 
tourism. 
72. Investment opportunities are prevalent in the hotel and catering industry, services and 
downstream related activities, conservancies and eco -tourism. Tourism Development Zones are being 
developed and offer a lot of good investment  opportunities, for example, the Great Limpopo 
Trans-Frontier Park, spanning the boarders of South Africa, Mozambique and Zimbabwe. The Park is 
the largest and the most ambitious effort in Africa to combine conservation, environmental protection, 
tourism and economic development. Other areas of i nvestment include sports facilities, restaurants, 
conference facilities and convention centers, theme parks and tourist village centers, air services, 
luxury tourist coaches and safari trains, hunting saf aris and community based tourism enterprises. 
2.3.8 Energy 
73. The country has an installed capacity of 1, 960 MW and national demand is approximately 
2,200 MW. The sector has performed poorly due to low generating capacity as a result of financial 
constraints, general poor state of infrastructur e, under capitalization compounded by debt ridden 
financial positions, disruptions in the supply of coal for generation as well as aged and obsolete 
equipment.  As a result, current electricity genera tion is only approximately 63% of installed capacity 
with part of the shortfall being met from imports. 
74. Zimbabwe imports all its liquid fuel requireme nts and the estimated monthly demand with the 
economy at its peak for diesel, petrol and jet fuel was 105 million, 90 million and 15 million litres 
respectively with transport and agricultural sectors consuming 60%.  
75. Government, in conjunction with the private se ctor, is exploring the production of fuel from 
ethanol with a view to introducing petrol by 2013. 
2.3.9 Telecommunications  
76. Information Communication Technology (ICT) has remained at the centr e of global social-
economic transformation and is paving way to the ex pansion and modernization of the sector in order 
to propel the country into a knowledge-based soci ety and enhance business links, competitiveness and 
overall economic development.  
77. During the period under review, the telecommunications sector witness the emergency of new 
players in the mobile telephone sub-sector following  the deregulation of the communications industry. 
The sector is regulated by the Postal and Teleco mmunications Regulations Authority of Zimbabwe 
(POTRAZ). Currently, there is one fixed tele phone operator and three mobile telephone service 
providers operating the 900-1800 MHz band with over 5 million subscribers. Internet access and 
public data service licenses have been issued to  15 service providers while over 30 internet service 
providers have been licensed to operate and are providing services to the public.   
78. Major challenges in the ICT sect or include inadequate ICT skills, limited financial resources 
for ICT development, theft and vandalism of th e ICT infrastructure and equipment and lack of 
coordination amongst service providers in infrastruct ure development and usage including sharing.  
79. The Government is now working on expandi ng the fixed telephone network and mobile 
telecommunication services through installation of a dditional base stations and other equipment with Zimbabwe WT/TPR/G/252 
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  a view to promoting infrastructure interconnectiv ity among ICT service providers thereby reducing 
costs. The extended coverage will further link up urban,  rural and tourist resort areas. Consistent with 
the regional and international standards, the teleco mmunications sector will be harmonized and in this 
regard, a new ICT Bill will be enacted during the MTP period to ensure compliance with modern 
trends, standards and quality of ICT services. Deve lopment of ICT technology parks will also be 
pursued.  
2.3.10 Insurance 
80. Zimbabwe's insurance industry comprises long-te rm (mostly life) insurance, short-term 
insurance (corporate, general, personal motor vehicle, fire, transport), and reinsurance.  At the end of 
2010, there were 26 registered and operating direct insurers and 8 reinsurers, down from a total of 
88 registered insurance companies in 2001.  Since 2009, short term insurance companies have been 
growing, due to growth in motor, fire and mi scellaneous insurance services.  Gross Premium Written 
(GPW) by direct insurers increased by 36.13 % from US$60.13 million in 2009 to US$83.12 million 
in 2010, while reinsurance business recorded a GPW growth of 37% over the same period. 
81. During the last decade , the performance of the insurance sector, just like the banking sector, 
was weak, reflecting a deteriorati ng economic environment and an unsta ble equity market. Fire, motor 
and miscellaneous accident insurances dominate d the business for both direct insurance and 
reinsurance. Several insurance companies went bankrupt as they undercapitalized and had poor asset 
quality profile that compromised their ability to meet their liabilities.   
82. The Insurance and Pensions Commission is the re gulatory authority of insurance activities in 
Zimbabwe.  
(3) INSTITUTIONAL  AND  STRUCTURAL  REFORMS 
3.1 Agriculture 
83. The Agricultural Marketing Authority (AMA) was re-introduced in February 2010 to ensure 
efficient and reliable marketing and regulati on of agricultural commodities in the country. 
84. Recognising the negative effects of controls on the pricing and trading of agricultural 
commodities, Government establis hed the Commodity Exchange in Zimbabwe (COMEZ) to allow 
market-based trading of agricultura l commodities, in order to restore the viability of farmers and to 
allow for diversification in the production of ot her commodities. The COMEZ, which is a private 
company will be regulated by the Securities Co mmission of Zimbabwe. Efforts are underway to 
obtain an operating licence from the regulator.  The COMEZ also aims to facilitate prompt payments 
with forward and futures contracts available for some produce. 
3.2 Mining 
85. To ensure the efficient exploration of mine ral resources, the Government reviewed the 
framework for mining rights, pricing of minerals  and surrender requirement s in 2009. The amendment 
to the Mines and Minerals Act is being finalized while the surrender requireme nt has been abolished. 
The Act will create an environment that allows the mineral endowment to be profitably exploited for 
the socio-economic development of Zimbabwe. The Act will further simplify the administration of 
mining titles, secure guarantees of tenure while en suring efficient use of land under title and 
incorporate communities in the development ag enda and environmental best practices.  WT/TPR/G/252 Trade Policy Review 
Page 18 
  
  86. Hoarding of claims which are not being worked  on will be discouraged through the adoption 
of the " use it or lose it " principle or through a penalty fee.  The Mining Affairs Board that will 
administer the policy will be empowered and resour ced to ensure that exces sive and/or speculative 
holding of claims will not be permitted. Furthermor e, the Government is in the process of developing 
the Exploration, Registration and Extraction Mi ning Policy which will form the basis for new 
comprehensive mining sector legislation. The new policy will provide for the separation of exploration from extraction policies and strategies.  Government will further explore the development 
of a comprehensive database on the quantity and qual ity of the country's mineral resource endowment.  
87. In order to facilitate the growth and sm ooth integration of small businesses into the 
mainstream economy, special attention is being given to the small to me dium scale miners so that they 
are empowered to be self sustaining and be able to expand operations and thereby create employment. In this regard, a special facility will be created for the provision of short term finance, technical assistance and capacity building and the management of the environment.  
88. In order to attract and retain key skills such as geologists, technicians and managers as part of 
the mining turnaround strategy, Government will stri ve to offer competitive remuneration packages. 
Priority will also be given to capacity building in these skills by allocati ng sufficient resources to 
training institutions such as the School of Mines. 
3.3  Manufacturing 
89. The Government is exploring avenues aimed at  facilitating the resuscitation of the private 
sector by way of securing injections of fresh working and medium to long term capital. 
90. As part of assistance in the revival of the manufacturing sector, Government established the 
Zimbabwe Economic and Trade Revival Fund ( ZETREF) with the support of the African 
Export-Import Bank (Afrexim Bank) in August 2010.  ZETREF is a line of credit facility for the 
private sector amounting to US$100 million which is earmarked to finance the acquisition of 
equipment, raw materials and spare parts in order to enhance output and qualit y of goods and services. 
91. In addition to ZETREF, Government intr oduced a US$40 million Distressed and 
Marginalised Areas Fund (DiMAF), in collaborati on with a local pension house in July 2011 to 
address capital challenges faced by dist ressed and marginalised industries.  
92. The Government is finalising a new Industr ial Development Policy Framework 2011-2015 
which is expected to address the challenges f acing the manufacturing sector. The Policy Framework 
identifies four priority sectors namely agro-pro cessing (food and beverages, clothing and textiles, 
wood and furniture), fertilizer industry, pharmaceutical s and metals & electrical to drive the IDP.  
93. IDP provides for the establishment of a dedicated and well-resourced institutional framework 
in the form of an Industrial Development Bank (IDB) that will primarily fund the manufacturing 
sector. The IDB will extend technical, financial and ma nagerial advice to its clients in planning and 
execution of the industrial projects. The bank will also facilitate transfer of technologies from 
developed countries to industrial enterprises in Zimbabwe. Zimbabwe WT/TPR/G/252 
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  3.4 Services 
3.4.1 Transport 
94. In looking forward, Government will formulate and implement the Civil Aviation Policy 
Framework which will entail restructuring of the Ci vil Aviation Authority of Zimbabwe (CAAZ) into 
an independent Regulatory Authority. CAAZ was established in 2001 
95. Government will establish an independent Regulat ory Authority for the road transport sector. 
3.4.2 Tourism 
96. Government launched a new touris m brand which goes by the name  'Zimbabwe - A World 
of Wonders'. The brand was launched in an effort to re -define and design a refreshed brand identity 
for Zimbabwe. 
97. During the MTP period, Government will work with the private sector and international 
partners within the context of Regional Touris m Organisation of Southern Africa (RETOSA) and 
United Nations World Tourism Organisation (UNWTO ) to develop the tourism sector in order to 
achieve the projected average growth rate of 6% a nnually. In this regard the National Tourism Master 
Plan will be developed and the Tourism administra tive system reviewed. The Tourism infrastructure 
will also be rehabilitated while tourists' access to information will be improved. 
3.4.3 Financial 
98. The Government adopted a multi-currency regime  in February 2009 to rein hyperinflation. 
Furthermore, Government deregulated exchange controls and delegated export administration and 
payment authority to banks in order to rem ove restrictions on business transactions.  
99. When the multi-currency system was adopted , the Reserve Bank set new capitalisation 
requirements for banks, revised the Prescribed Asset  ratios for Pension and Insurance Funds, reopened 
the Zimbabwe Stock Exchange, and set the requi rements for reintroducing the Real Time Gross 
Settlement System (RTGS) and the use of plastic mone y, all of which were designed to strengthen the 
integration of the financial sector and revive private sector activities. 
100. Government simplified the approval process for ex ternal loans, with authority delegated to 
banks to process loans of up to US$5 million w ithout prior Treasury and Reserve Bank External 
Loans Coordinating Committee (ELCC) approval in  order to remove bureaucratic hurdles.  
101. In 2009, Government initiated reforms targ eted at refocusing the Reserve Bank of 
Zimbabwe's institutional framework to its core bus iness of financial sector supervision, monetary 
policy and ensuring efficient payment system. The reforms were aimed at making the Reserve Bank 
an independent institution by appropriately limiting the Government's operations and oversight while 
ensuring that effective accountab ility mechanisms are maintained. 
102. Cognisant of the important role of the ZSE in the development of the securities market, in 
July 2011, Government appointed an independent, professionally diversified Interim Board to take 
over the oversight of the ZSE. The rationale for a ppointing this independent  Board was to separate 
ownership and management , thus eliminating conflict of interest arising from stock brokers 
supervising the market. The Interim Board is now seized with ensuring that ZSE has adequate skills 
mix to run the bourse and is, in liaison with the Securities Commission, working on the WT/TPR/G/252 Trade Policy Review 
Page 20 
  
  demutualization of the ZSE, establishment of a Central Securities Depository (CSD) and automation 
of trades.  
3.4.4 Energy 
103. A number of reforms were undertaken in the ener gy sector in order to enhance the availability 
of adequate and reliable energy. One of the major reforms was opening up of the oil industry to new 
players. Prior to 2003, NOCZIM was the sole importer of fuel in Zimbabwe with other oil companies 
(BP and Shell, Mobile, Caltex and Total), wh ich are all multinationals, purchasing fuel from 
NOCZIM for distribution through the country. In 20 03, Government opened up the oil industry to 
new players and it also opened up the fuel import business to all players registered as such, resulting 
in a multiplicity of fuel importers in the country.  
104. In 2010, NOCZIM was restructured into two companies namely Petrotrade (Pvt) Ltd 
(responsible for fuel trading) and National Oil Infrastructure Company of Zimbabwe (Pvt) Ltd 
(NOIC) responsible for the fuel logistics infrast ructure (pipeline and bulk storage facilities). The 
successor companies started operations in the first qua rter of 2011. The pipeline and related storage 
facilities are available for use by all registered importer for a fee.  
105. Government and the oil industry agree on a maximu m price of fuel for a month, based on cost 
factors that are incorporated into a pricing model an d can be adjusted as necessa ry to ensure that fuel 
prices remain economic. The cost elements used in  the pricing model are FOB prices, transport, 
taxes/levies, storage and handling, othe r administrative costs and margins.  
106. The Electricity Act of 2002 resulted in the rest ructuring of the Zimbabwe Electricity Supply 
Authority (ZESA) in order to encourage investment in the power sector by establishing an appropriate 
regulatory framework. The Act established the Zimbabwe Electricity Regulatory Commission 
(ZERC) to regulate the electricity sector. The Act also resulted in the unbundling of ZESA into separate companies responsible for generation, transmission, distribution and supply of electricity. The main objective of unbundling the Authority was the need to set up a separate company responsible for generation of el ectricity and allow competition through the introduction of 
independent power producers. In addition to the establishment of a regulatory commission, the 
restructuring of ZESA also resulted in the formati on of a separate entity for the acceleration of the 
rural electrification programme through the enac tment of the Rural Electrification Fund Act 
(Chapter 13:20) of 2002. 
3.5 Others 
3.5.1 Taxes and Customs Procedures 107. In an effort to, inter alia , improve operational efficiency, capitalize on synergies as well as 
broaden service provision to the public, the Department  of Taxes and the Depa rtment of Customs and 
Excise were merged to form the Zimbabwe Reve nue Authority (ZIMRA) in January 2001 under the 
auspices of the Revenue Authority Act promulga ted in 2000.  ZIMRA has a mission to promote 
economic development through effici ent revenue generation and trade facilitation and has thus put in 
place client-centric strategies for the convenience of the transacting public.  
108. In this regard, more stations and border posts have been opened nationwide since the 
establishment of the organization in 2001. Operational hours at some ports of entry/exit have also been extended for the convenience of the public. The Authority recently  introduced a fully functional 
Large Client Office (LCO) to administer large clie nts in a personalised way.  Measures such as the use Zimbabwe WT/TPR/G/252 
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  of scanners, border patrols, pos t-importation audits, client awareness programmes and cargo 
monitoring have been put in place in order to fi ght underhand dealings a nd smuggling of goods.  
109. Significant progress has been made in embracing information and communication technology 
as part of the Authority's efforts to moderni se Tax and Customs operations. Such developments 
include the introduction of ASYCUDA World and scanne rs at some stations to expedite customs 
clearance. 
110. Through its advisory role to the Government of Zimbabwe on fiscal matters, various fiscal 
reforms aimed at broadening the tax base have been successfully introduced and these include 
Presumptive Tax, Value Added Tax and Self Assessment of Income Tax. 
111. The organisation has been mandated with the collection of Road Tolls, Royalties on Minerals, 
and has been appointed, by the Motor Insurance Pool  of Zimbabwe in conjunction with the Ministry 
of Transport, Communication and Infrastructural Deve lopment, as the sole agent for the issuing of 
Road Traffic Act insurance policies and collecting premiums thereon for all foreign registered vehicles entering Zimbabwe and foreign destin ed vehicles with effect from March 2010. 
3.5.2 Public Procurement 
112. Zimbabwe is not a contracting party to the Plurilateral Agreement on Government 
Procurement, but an observer, since the Tokyo Round. However, the country has in place a Procurement Act enacted in 2001. The Procurement Act and regulations apply to purchases by any 
Ministry, Department or other division of Government, statutory bodies, and any local authority or other person declared to be a procuring entity. The regulations also apply to state owned enterprises 
wholly owned by Government or in whic h Government has a controlling interest. 
113. The State Procurement Board is composed of members appointed by the President from the 
public and private sectors (chambers of industry, commerce and other professional bodies). Invitation 
to tender including invitation to pre-qualify is the main mode of awarding contracts for the 
procurement of goods, construction work or services.  
114. The Government Gazette is the statutory means of disseminating contracts awarded by the 
state. The Procurement Act provides for parties to  any procurement dispute to utilise the courts 
arbitration process although it does preclude the par ties to approach other institutions to solve 
procurement disputes. 
115. The Procurement Act and regulations will be  reviewed for possible improvements and 
procurement guidelines. Standard  bidding documents will be de veloped as part of the ongoing 
Technical Assistance Project being funded by the World Bank which ends in 2013. The project will 
also provide for the development of training manua ls and capacity for e-procurement in line with 
changing global trends. 
3.5.3 Technical Standards and Product Quality 
116. The Standards Association of Zimbabwe (SAZ), which is administered by the Ministry of 
Industry and Commerce, is responsible for regulating standardization of the quality of all products in 
Zimbabwe.  
117. SAZ is responsible for the preparation of  national standards in association with 
representatives from manufacturers, trade associations, Government departments, Consumer Council WT/TPR/G/252 Trade Policy Review 
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  of Zimbabwe, educational, research, professional and testing institutions. Interested parties including 
SMEs are encouraged to participate in voluntary national standards development work in order to 
ensure that the standards produced ar e not technical barriers to trade. 
118. SAZ is also responsible for the publication of  national standards and has to date published 
1440 Zimbabwean standards. In addition to the prepar ation of national standard s, SAZ is responsible 
for the certification processes to SAZS ISO 9001,  14001, 22000 and OHSAS  18001 and any other 
standards.  
119. SAZ is the National Enquiry Point for Technical Barriers to Trade. As a signatory to the 
WTO code of good practice for the preparation, adopti on and application of standards, the SAZ abides 
by the principles of openness, balance of interest s and participants, due process and consensus and 
adopts international and regional standards in  order to facilitate international trade. 
120. The Trade Measures Department in the Ministry h as the statutory role of custodian of primary 
and tertiary standards in Zimbabwe traceable to in ternational standards. The Department is charged 
with the responsibility of regulati ng, monitoring, inspecting and ve rifying all weights, measures, 
weighing and measuring instruments used for trade in Zimbabwe. 
3.5.4 One-Stop Shop Investment Centre 
121. In an effort to remove impediments to the investment approval process, Government 
established the one Stop Shop Investment Centre in  December 2010 whose aim is to streamline the 
investment approval processes and bring together (under one roof) the key departments involved in 
investment facilitation thereby promoti ng both domestic and foreign investment. 
3.5.5 ZimTrade 
122. The role of ZimTrade as the organisation res ponsible for assisting companies to export their 
goods and services will have to be intensified. ZimT rade will be expected to assist companies to 
market their value added produc ts and reposition Zimbabwe as a reliable export country. The 
organisation has to refocus and align itself with ne w trends of the export market by identifying niche 
markets where Zimbabwe can easily penetrate. 
3.5.6 Competition Policy   
123. Zimbabwe formally adopted competition policy and law in 1996 with the enactment of the 
Competition Act. The Act came into force in 1998 r esulting in the establishment of the Industry and 
Trade Competition Commission (ITCC) as the implementing authority. During the same period, a Tariff Commission Act was enacted and the Tariff Commission (TC) was established. 
124. In 2001, the two commissions were merged to form the Competition and Tariff Commission 
(CTC) in order to strengthen control and enforcem ent of the two organizations. The mandate of the 
Commission is to promote and maintain competition and fair trade in the economy. This is done 
through the prevention and control of restrictive pr actices, the regulation of mergers, the prevention 
and control of monopoly situations , the prohibition of unfair business and trade practices and the 
promotion of the growth of efficient export-oriented  and internationally competitive industries within 
the framework of the economic policy of the country.  
125. The Commission is the Investigating Authority fo r unfair trade practices taking place in the 
economy. To operationalise this function, two statutory instruments namely the Competition Zimbabwe WT/TPR/G/252 
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  (Anti-Dumping and Countervailing Duty) (Inves tigations) Regulations 2002 and the Competition 
(Safeguards) (Investigations) Regul ations 2006 have been put in place. The Commission, however, 
does not have institutional capacity to effec tively use the Trade Remedy Measures.   
(4) TRADE  POLICIES  AND  PRACTICES 
4.1 Trade policy objectives  126. Zimbabwe is in the process of developing a comprehensive stand-alone National Trade Policy 
within the overall national development framework. The trade policy aims to promote the private 
sector as the engine for growth, support the progr essive liberalization of trade, efficient and 
internationally competitive domestic industries, fa cilitate trade developmen t, export promotion and 
compliance with international trade protocols.  
127. The comprehensive National Trade Policy will le verage the revised Industrial Development 
Policy to address challenges facing the manufacturing sector. 
128. Current policy on trade is enshrined in the various economic and development policy 
frameworks whose aim is to promote growth and de velopment of the private sector in the production 
and distribution of goods and services for both the domestic and international markets. Government 
will continue with reform of the tariff regime to  improve transparency and predictability. Measures 
will also be taken to safeguard the interests of do mestic industries against unfair trade practices and to 
protect the Zimbabwean population from health, saf ety and moral hazards as well as protect plant and 
animal life.  
129. Zimbabwe recognizes the need to promote grow th through increased value addition in the 
various sectors of the economy and in this rega rd, efforts are ongoing to streamline and where 
applicable, reduce tariffs. 
130. The Ministry of Industry and Commerce is res ponsible for the formulation, administration 
and coordination of trade and in dustrial policies. The process involves consultations with other 
Government departments, private sector, civil society and other trade-focused institutions. 
4.2 Import and tariff regime 
131. Zimbabwe's imports are governed by the Op en General Import License (OGIL) where 
imports and exports are exempted from licenses. Certain products, however, require import licenses 
which are administered by the Ministry of Industry and Commerce, through the Control of Goods Act. 
Zimbabwe requires permits for selected agricultural imports and these are granted by the Ministry of 
Agriculture, Mechanisation and Irrigation Developmen t.  Some animal products require a separate 
permit under the Animal Health (Import) Regulations  to comply with Sanitary and Phytosanitary 
regulations.  The purpose of licensing is for Sanita ry and Phytosanitary requirements and statistical 
purposes.  
132. The Zimbabwe tariff structure consists of 9 bands namely;  0%, 5%, 10%, 15%, 20%, 25%, 
40% and 60%. The tariff regime also consists of specific duty and combination rates of duty on 
products such as clothing, footwear and travel bags.  
133. The country's successive tariff rationalisation over the years has produced a cascading tariff 
structure categorized into raw ma terials and capital goods with low duties, intermediate goods with 
moderate duties and final goods with relatively high duty rates. The adopted tariff structure takes into WT/TPR/G/252 Trade Policy Review 
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  consideration the value addition processes obtaining in the economy. The categories and tariff bands 
are as reflected in the following table; 
Category Bands 
Raw materials 0-5% 
Intermediate goods 5-25% 
Capital goods 0-5% 
Finished goods <40% 
Sensitive goods >40% 
 134. In addition to the 40% customs duty, clothing, footwear and some travel goods attract specific 
charges as measured by weight in kilogrammes.   
135. The above duty structure applies to commerc ial importations, whereas, private importations 
by individuals are subject to flat rates of duty at 55%.  
136. The tariff regime that has evolved over the past  decade is a reflection of the Government's 
response to address national needs under di fficult environmental circumstances.  
4.3 Export policy 
137. The generation of increased foreign exchange ear nings is central to the transformation of the 
Zimbabwean economy. The predominance of unprocessed  primary goods in the country’s basket of 
exports, massive deterioration in general infrastru cture and quality control management has largely 
constrained capacity to maximize export earnings . The National Export Strategy acknowledges the 
dynamics of the international trading system whic h seeks to take advantage of the provisions of the 
regional and international trading arrangements.  
138. The Government recognizes the need to unlock th e vast export opportunities at its disposal in 
order to attain and maintain trade competitiveness in  the regional and global markets. In addition to 
addressing capacity utilization constraints a nd rendering support to productive sectors, the 
Government is guided by the vision to transform Zi mbabwe from being a primary goods producer to a 
producer of processed value-added goods for both the domestic and export markets. In this regard, the 
export-led industrialization program  will be underpinned by the Nati onal Trade Policy currently being 
developed. The focus will be to accelerate valu e addition through productio n of higher value chain 
products that embrace e-technology and ICT geared towards the penetration of new and remunerative 
foreign market niches. 
139. Currently, Zimbabwe is adding value to its ag ricultural produce (horticulture, tea and coffee) 
and some minerals. Although there is provision in th e Zimbabwean legislation for levying export tax, 
there is no export tax in force as exports of chrome ore which previously attracted a tax of 20% were 
banned in January 2010. 
4.4 Investment regimes 
140. The Zimbabwe Investment Authority (ZIA ) which is a successor organization to the 
Zimbabwe Investment Centre and the Export Processing Zones Authority was established in 2007 to promote and facilitate both local and foreign dir ect investment. In executing its mandate, the ZIA 
promotes and coordinates investment activities and enterprises or sectors of the economy which are of 
strategic importance to the nation. Zimbabwe WT/TPR/G/252 
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  141. Levels of investment into the Zimbabwean economy have historically been low averaging 
around 4% of GDP since 2000. The country's capacity to attract meaningful investment has been affected by a number of issues ranging from negative publicity, high start up costs, partial fulfilment 
of Bilateral Investment Promotion and Protec tion Agreements (BIPPAs)  obligations, negative 
perception of the recently published legislation on economic empowerment a nd indigenisation, poor 
infrastructure and the time taken to a pprove projects and residence permits. 
142. Zimbabwe's Constitution guarantees legal protectio n for all investors irrespective of country 
of origin, including the right to private property.  Zimbabwe has signed BIPPAs with over 30 countries including Mozambique, China, Malaysia , Iran, Switzerland, India, Indonesia, Jamaica, 
Netherlands, South Africa, United Kingdom, Mala wi, Botswana, Czech Republic, and Tanzania. 
143. The mining sector is one of the major recipients  of Foreign Direct I nvestment accounting for 
77% of approved investments by the ZIA for th e period January 2009 to October 2010.  The other 
major investment recipients are manufacturing, to urism and agricultural sectors. The major sources of 
investment are China, South Africa, and Mauritius.  
144. The investment regime provides for a numbe r of incentives for investors, including 
remittances of up to 100% of after tax profit, a tax holiday for the first five years and a special tax rate 
of 25% thereafter in the mining and tourism sect ors, VAT exemptions for the procurement of 
materials imported for use in development of in frastructure, allocation of industrial land by 
Government on a thirty year renewal lease, ex emption of duty on imported capital goods and a 10% 
corporate tax for a period of 15 years on in come derived from infrastructure projects. 
145. Six sectors have been identified as priority  sectors for investment namely, Energy, 
Infrastructure, Agriculture, ICT, Tourism and Manuf acturing. Government has also reserved  sectors 
for local investors including (i) agriculture & for estry:  (a) primary production of food and cash crops 
(b) primary horticulture (c) game, wildlife ranching and livestock (d) forestry (e) fishing and fish 
farming (f) poultry farming (g) other agro in dustry involving post-growth processing (ii) 
Transportation:  (a) road haulage (b) passenger bus, taxis and car hire services of any kind (c) tourist 
transportation (excluding airways) (iii) Retail/Wholesale trade, including distribution of local and 
other locally produced goods (iv) Barber shops , hairdressing and beauty salons (v) Commercial 
photography (vi) Employment agencies (vii) Esta te Agencies (viii) Valet services (ix) Armaments 
manufacture, marketing and distribution (x) Publ ic water provision for do mestic and industrial 
purposes (xi) Rail operations (xii) Grain mill produ cts (xiii) Bakery products (xiv) Sugar products 
(xv) Tobacco packaging and grading (pos t auction); and (xvi) Tobacco products. 
146. In an effort to increase investment flows in to Zimbabwe, Government will continuously 
assess the incentives to ensure they  are in tandem with international best practices, finalise the 
amendment of the Mines and Minerals Act and in fluence speedy conclusion of negotiated BIPPAs as 
well as expedite the negotiation of more BIPPAs with other countries. 
4.5 Sanitary and phytosa nitary (SPS) measures 
147. Sanitary and Phytosanitary (SPS) issues are of particular relevance to  the agricultural and 
agro-processing sectors of the economy. Every agricultu ral commodity that is of plant or animal 
origin is subject to SPS measures to enable its im portation into Zimbabwe. Veterinary Import Permits 
and Plant Import Permits are issued by the responsib le departments under the Ministry of Agriculture, 
Mechanisation and Irrigation Development (MAM ID). Whereas MAMID is responsible for SPS 
issues related to animal and plant commodities, the Government Analyst Laboratory is in charge of WT/TPR/G/252 Trade Policy Review 
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  food safety, quality and standardisation, water tr eatment and industrial processing. In addition to 
national standards, these organisations also use th e standards set by international standard setting 
bodies such as the Codex Alimentarius Commission , International Plant Protection Convention and 
the World Organisation for Animal Health  in undertaking their responsibilities.  
148. In compliance with the provisions of the WTO Agreement on the application of SPS 
requirements, MAMID is the National Notification Au thority while the Department of Livestock and 
Veterinary Services, Department of Research and Specialist Services and the Government Analyst Laboratory are the Enquiry Points for Animal Health, Plant Health and Food Safety issues respectively.  
149. A committee responsible for SPS matt ers has been in existence but was not effective. It was 
however, resuscitated and formalised in 2009. The committee comprises representatives from various 
Government Ministries and institutions, producer asso ciations, food manufacturers, and academia. It 
is responsible for advising policy makers on SPS  issues in the country. The committee holds its 
meetings once every 2 months and on an ad hoc basis depending on the urgency of the matter. In 
2009, a National SPS Workshop was held with technical  assistance provided by the WTO Secretariat.  
4.6 Intellectual property rights (IPRs) 
150. Zimbabwe is one of the few African countries th at have enacted various intellectual property 
protection laws in compliance with the TRIPS Agreem ent. Government ratified most of the IPR laws 
namely copyrights, trademarks, geographical indi cations, industrial designs, patents and layout 
designs of integrated circuits during the period 2 001 to 2004.  However while these laws are in place, 
the public is not fully aware of the existence of such laws. 
151. The Intellectual Property Tribunal which was established in 2010 has jurisdiction to hear 
contentious matters under the following laws:  Copy right and Neighbouring Rights Act, Geographical 
Indications Act, Industrial Designs Act, Integrated Circuit Layout Designs Act, Patent Act, and Trade 
Marks Act. 
(5) TRADING
 ARRANGEMENTS 
152. Zimbabwe is signatory to a number of bilateral, regional and multilateral trading 
arrangements. 
153. At the bilateral level, Zimbabwe entered in to Bilateral Trade Agreements encompassing both 
Preferential Trade Agreements (PTAs) and Most Favoured Nations (MFN) with over forty countries 
across the globe. These agreements are aimed at br oadening the scope for market access on the basis 
of reciprocity.   
154. Government will review the existing Bilateral Trade Agreements with a view to assess their 
relevance and to accommodate deve lopments on national, regional a nd multilateral trading systems. 
Some of the agreements have proved to be deficien t in respect of areas such  as rules of origin and 
other trade support mechanisms to facilitate trade and foster economic co-operation.  
5.1 Regional trading agreements 
155. Zimbabwe is a member of Common Market for Eastern and Southern Africa (COMESA) and 
Southern African Development Community (SADC) Free Trade Protocols in support of the regional integration agenda. The FTA Protocols provide  for duty-free importation of goods from COMESA Zimbabwe WT/TPR/G/252 
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  and SADC member states, provided such goods meet  set criteria on the rules of origin. While the 
benefits of regional integrati on are not being questioned, the local industry capacity to face 
competition following the downward spiral experienced in the last few years has called for the levying 
of duties on selected strategic/sensitive pr oducts to nurture industries under stress.  
5.1.1 Common Market for Eastern and Southern Africa (COMESA) 
156. Zimbabwe is a founder member of the COMESA since its inception as the Preferential Trade 
for Eastern and Southern Africa (PTA) in 1981.  
157. Zimbabwe is an active participant in the integr ation agenda of the COMESA region, which is 
working on the transformation of the FTA into a Customs Union. The COMESA Customs Union was 
launched in 2009 and is scheduled to be implemented in 2012.  
158. In addition to trade liberalization, Zimbabwe is also participating in a number of COMESA 
programmes in the areas of agriculture, gender, infr astructure, climate change, trade facilitation and 
harmonization of standards in the region.   
5.1.2 Southern African Development Community (SADC) 
159. Zimbabwe is a founder member of SADC wh ich was established in 1980 as the Southern 
African Development Coordination Conference (SADCC). In 1996, the SADC Member States 
developed and signed a Trade Protocol in order to deepen integration in the area of trade. The Protocol, which came into force in 2000, introdu ced a trade liberalization programme in which 85% 
of all intra-SADC trade were expected to be dut y-free by 2008; leaving the remaining 15% of imports 
classified as sensitive products to be fully liberalized by 2012. 
160. Zimbabwe is participating in the SADC FTA th at was established in January 2008, with 20% 
of tradable goods being in the sensitive basket . In 2010, the country was granted derogation from 
implementing tariff phase-down on sensitive products  until 2014 under Article 3 of the SADC Trade 
Protocol.  
161. Zimbabwe is participating in the preparations for the transformation of the SADC FTA into a 
Customs Union.  
5.1.3 The COMESA-EAC-SADC Tripartite Free Trade Area  
162. Zimbabwe acknowledges the complications aris ing from her overlapping membership to 
COMESA and SADC. This makes Zimbabwe's trade policy complicated by the web of inter-related 
regional trade liberalization commitments with different tariff phase-down schedules, rules of origin and ambitions of regional integration existing in  the two different Regional Economic Communities 
(RECs).  
163. To this end, the country is party to the Trip artite FTA initiative among the three RECs namely 
COMESA, SADC and East African Community (EAC).   The Tripartite initiative aims to harmonise 
trade regimes of the three RECs, free movement of business persons within the three RECs, joint 
implementation of regional infrastructure proj ects and programmes, and legal and institutional 
arrangements for regional cooperation that include d establishment of a series of common institutions 
at tripartite level.  WT/TPR/G/252 Trade Policy Review 
Page 28 
  
  164. One of the most significant outcomes of this  initiative has been the establishment of the 
first One-Stop Border Post in Africa between Zambia and Zimbabwe at Chirundu in 2010.   
5.1.4 European Union-Eastern and Southern  Africa Economic Partnership Agreement 
165. Zimbabwe is signatory to the African Cari bbean Pacific (ACP) - European Union (EU) 
Cotonou Partnership Agreement that was govern ed by the Lome Conventions between 1975 and 
2000.  
166. As stipulated in the Cotonou Agreement, the EU and the ACP countries agreed to negotiate 
and conclude new Economic Partners hip Agreements (EPAs), which are compatible with the WTO by 
December 2007. Under the new agreement, trade be tween the EU and the ACP countries would be on 
a reciprocal basis. Zimbabwe is negotiating the EPAs under the configuration of the Eastern and 
Southern Africa (ESA) region. The ESA region comprises 11 countries that are also COMESA member states. 
167. In the later part of 2007, it became apparent  that it would be impossible for the ESA region 
and the EU to conclude the EPA negotiations with in the stipulated deadline and this led to the 
conclusion of an Interim EPA. The Interim EPA is de signed to take care of the trade relations between 
the ESA region and the EU while negotiations towa rds the full EPA continue. Zimbabwe signed the 
Interim EPA in August 2009 but has not yet ratified the agreement. 
168. Zimbabwe will gradually liberalise 80% of its imports from the EU within 15 years after a 
moratorium (grace period) of 5 years. Zimbabwe's first tranche of liberalization is in 2013 and is mainly for raw materials and capital goods. The next tranche for liberalization will be in 2015 and it 
covers mainly intermediate  and finished products. 
5.2 Multilateral commitments 
5.2.1 World Trade Organisation (WTO) 
169. Zimbabwe is an original WTO Member, having been a GATT Contracting Party.  Zimbabwe 
ratified the WTO Agreement on 5 March 1995.   
170. Zimbabwe is an active member of the African , Caribbean and Pacific (ACP) Group, the WTO 
African Group and the G-90. It is also a member  of the G-33 and G-20 agricultural groupings of 
developing countries. With regards to the country’s interest in the Doha De velopment Agenda (DDA), 
Zimbabwe is focused on agriculture, market acce ss, special and differential treatment. Zimbabwe 
supports the objectives and work of the G-33 on Sp ecial Safeguard Mechanism (SSM) and Special 
Products (SPs) with a view to promote food secu rity, rural development and poverty alleviation as 
well as addressing import surges and price declines in a manner that is not administratively 
burdensome.  
171. As a member of the G-20, Zimbabwe supports the group’s view that agricultural trade 
reforms through substantial reducti on in domestic support, increase in market access, the phasing out 
of all forms of export subsidies and operational a nd effective special and differential treatment for 
developing countries can unlock the potential for agri culture in the developing world.  In the NAMA 
negotiations, Zimbabwe as one of the countries liste d under Paragraph 6 of the July 2004 Framework, 
has sought flexibilities in tariff bindings that will provide for policy space to allow for domestic 
industrial sector development as well as support regi onal integration activities. Zimbabwe also seeks 
technical assistance and capacity building through Aid for Trade. Zimbabwe WT/TPR/G/252 
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  172. Zimbabwe will continue to actively partic ipate in the Multilateral Trading System 
negotiations to advance the country's interests.  
173. As a landlocked developing country, Zimbabwe faces major challenges in the movement and 
transportation of goods destined for the regional a nd international markets. In the area of trade 
facilitation, Zimbabwe has made progress by establishing a taskforce comprising stakeholders from 
Government and the business sector with a view to identifying areas of impediments in trade facilitation and contribute to the smooth movement of  goods. The taskforce was formed as a result of 
the WTO Trade Facilitation Needs As sessment initiative carried out in  Zimbabwe in May 2009.    
174. Zimbabwe is lagging behind in its WTO notifi cation obligations due mainly to capacity 
constraints. The country however, has made notif ications to the WTO on Non-Preferential Tariffs, 
Import Licensing Procedures, State Trading Enterp rises and agriculture, among others. Additional 
technical assistance and capacity building will be re quired to improve on the level of notifications. 
5.2.2 Global System of Trade Preferences (GSTP)  
175. Zimbabwe is a participating member to the GSTP arrangement which provides for 
preferential tariff concessions and other forms of cooperation aimed at opening up as well as 
increasing trade amongst developing countries within  the context of South-South Cooperation.  
5.3 Aid for Trade 
176. During the period under review, Zimbabwe recei ved limited aid from its traditional donor 
partners and agencies due to the difficult situ ation the country was going through with the 
international community. The country has been penali zed in its formal participation in aid for trade 
due to sanctions. Donor support was mainly in the fo rm of humanitarian aid. Aid for Trade was not 
country specific to Zimbabwe but through region al institutions such as COMESA and SADC. The 
support was meant for regional integration progra mmes in the areas of trade facilitation (Chirundu 
One-Stop Border Post), private sector participati on in trade, ICT, technical assistance and product 
development. The WTO provided Aid for Trade in the area of technical assistance and capacity 
building through the Institute of Training and Tech nical Cooperation (ITTC). This was provided in 
the form of national and regional workshops as well as the setting up of two reference centers at the 
Ministry of Industry and Commerce and University of Zimbabwe.  
177. Zimbabwe needs technical assist ance to help build supply-side capacity and trade-related 
infrastructure to expand trade and, in the process,  increase employment. Aid for Trade should support 
the SMEs sector to contribute to economic grow th and development thr ough enhanced productive 
capacity and provision of technical support for valu e chain analysis to incr ease efficiency as well as 
address standardization issues, among others.  
178. Technical assistance and capacity building is n eeded to equip the notification authorities and 
trade enquiry points to manage operations, including  in the area of information management and 
quality of service delivery. Further assistance is need ed in the area of implementation of agreements 
such as trade remedies, to enable the country to  cope with the negative effects of unfair trade 
practices, thereby helping industries to compete in the domestic market. 
(6) MEDIUM-TERM
 OUTLOOK 
179. The medium-term outlook for Zimbabwe hing es on the successful implementation of the 
MTP whose main goal is to transform the ec onomy, reduce poverty, create jobs, maintain WT/TPR/G/252 Trade Policy Review 
Page 30 
  
  macroeconomic stability and restore the econo my's capacity to produce goods and services 
competitively, building upon the gains achieved since the launch of STERP in March 2009 and its 
subsequent implementation.  
180. Key areas for success include infrastructural de velopment, institutional capacity building, 
review of current and introductio n of new regulations and stre ngthening and establishment of 
regulatory authorities to improve efficiency an d facilitate investment and economic growth.  
181. The projected average growth target of 7.1% ove r the plan period will be realised through the 
transformation of the economy from being a produ cer of primary commodities to value addition, 
beneficiation and new knowledge based industries.  A monitoring and evaluation mechanism will be 
put in place to provide information on progress on the implementation of the MTP programmes, 
policies and development strategies. 
182. Adoption of tariff regimes that are supportive of  industrial growth and export development 
while complying with multilateral obligations will be pursued. 
183. The MTP projects imports growth to rise in tandem with nominal GDP growth, reflecting the 
economy's recovery expansion. Exports are forecast to  increase at a faster rate (10%) than growth in 
the rest of the economy reflecting the dominance of the mining sector. The expected transformation of 
the economy, improved business climate and opportun ities arising from regional and international 
markets will drive the increase in manufactured e xports. Export led growth will be critical in the 
economic trajectory during the Plan period in line with the National Trade Policy.  
184. The Plan identifies measures that  need to be put in place to achieve the export targets which 
include improving competitiveness by lowering the cost of production and transaction costs, 
maintaining macroeconomic stability, investing in new technologies, diversification of the export 
basket and new markets developments.  
185. Zimbabwe's participation in the regional and multilateral trade negotiations play a catalytic 
role in achieving sustainable economic growth and de velopment. Trade plays an important and pivotal 
role in the attainment of higher efficiency, pr oductivity and international competitiveness of all 
economic sectors. It is important to note that trad e is not an end in itself but a means to achieving 
economic growth and ultimately improve the standard s of living of the people of Zimbabwe in line 
with the vision of the country.  
186. As indicated earlier in this report, the continue d application of sanctions by some members of 
the international community continues to seriously  impede Zimbabwe's ability to comply with its 
obligations to liberalise trade and services at the mult ilateral and regional levels. It is only through the 
removal of the sanctions that the country will be able to move towards full compliance. Zimbabwe 
therefore looks forward to the support of the WTO membership in this endeavour. 
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