Zimbabwe has historically been one of the most robust economies in southern Africa, with substantial natural resources and a highly regarded workforce. The performance of the Zimbabwean economy will remain inextricably linked to the policy and political climate over the coming years. Zimbabwe’s government is gradually beginning to re-engage with the international development community.

We keep our clients informed of the latest market moves and political developments in Zimbabwe, as part of our 'top-down' and 'bottom-up' perspective. Clients also benefit from in-depth analysis on 12 of Zimbabwe’s most important industries. We provide interactive data and forecasting alongside detailed and risk-assessed analysis from our expert research teams. Our aim is to keep you ahead of the game, so you can do business with ease in Zimbabwe.

Country Risk

Zimbabwe Country Risk

BMI View:

Core Views:

  • Growing signs of internal divisions in the ruling ZANU-PF adds to existing uncertainty over the future of politics in Zimbabwe once 91-year-old President Robert Mugabe retires or dies. Against this backdrop, a worsening economic climate will put added pressure on government stability.

  • The deflationary conditions that Zimbabwe has been experiencing for the past two years will persist through 2016 due to subdued domestic demand, a weak South African rand and weak international commodity prices.

  • Political and policy uncertainty will continue to deter much-needed investment into the moribund Zimbabwean economy, while a weak harvest, depreciating South African rand, and lower commodity prices will also weigh on short-term economic activity.

  • We estimate that the Zimbabwean economy slipped into...

Zimbabwe Operational Risk Coverage (9)

Zimbabwe Operational Risk

BMI View:

BMI View: Zimbabwe's economic crisis and political isolation has contributed to a marked deterioration in the country's business environment over the past 15 years. In particular, businesses face a myriad of risks stemming from corruption and a large bureaucratic burden, which lowers the country's competitiveness relative to its southern African neighbours, such as Zambia and, to a greater extent, South Africa. Other salient threats include poor access to utilities, notably water and power, as well as insecure property rights for foreign businesses. Moreover, the quality of Zimbabwe's health care sector has declined considerably over the last several decades, thereby contributing to poor health within the labour force. As a result, the country receives a score of 34.7 out of 100 for Operational Risk, ranking 27th out of 48 states in Sub-Saharan...

Zimbabwe Crime & Security

BMI View:

BMI View: Crime and Security Risk is the lowest area of risk in the Operational Risk environment for investors and businesses in Zimbabwe. Zimbabwe offers a safer operating environment than most Sub-Saharan African (SSA) states, as the country enjoys stable relations with its neighbours, is not a target of international terrorist groups and has comparatively low levels of violent crime. The main security risk to investors in Zimbabwe stems from the threat of political violence which tends to flare up around election periods. Current succession battles within the ruling party, ZANU-PF have contributed negatively to political stability in Zimbabwe, and we have seen a premature spike in political violence with different factions engaging in clashes countrywide in 2015. While foreign workers and travellers are exposed to petty theft and burglaries, crime affecting businesses such as cyber and financial crime is low. As a...

Zimbabwe Labour Market

BMI View:

BMI View: Zimbabwe's labour market cannot compete with its regional peers owing to low levels of productivity, public health issues and the residual effects from the economic collapse and hyperinflation during the mid-2000s. Although Zimbabwe has a favourable demographic situation, with more than 60% of the population younger than 24, the country has proved incapable of turning its population into skilled workers, and we see no sign of this situation improving over the medium term. Taking these factors into consideration, BMI awards Zimbabwe a score of 36.9 out of 100 for Labour Market Risk, placing the country 29th in Sub-Saharan Africa (SSA), between Cote d'Ivoire...

Zimbabwe Logistics

BMI View:

BMI View: Zimbabwe has a limited and low-quality transport network. With a lack of access to maritime trade flows and the added stress placed on an ailing road and rail network, Zimbabwe's reliance on its neighbouring countries for efficient trade poses a threat to investors. Additionally, movement of goods is hampered by lengthy bureaucracy and relatively expensive trade procedures, creating additional costs for businesses. Although the country presents well in terms of its market size, due to steady economic growth following years of decline, the country is at risk from adverse affects of its current trade deficit and expensive fuel costs, compromising the success of business operations in the country.

Zimbabwe scores 33.6 out of 100 in the BMI Logistics Risk Index,...

Zimbabwe Trade & Investment

BMI View:

BMI View: The combination of endemic corruption, weak rule of law, caps on foreign investment and a lack of its own currency serve to make Zimbabwe an unattractive operating environment for foreign firms. Corruption in particular poses a major obstacle to foreign investment and participation in the economy by lowering the accountability and impartiality of the judicial system, incurring adverse consequences for important procedures such as the filing and paying of taxes, the resolution of contractual disputes and the registration of property. Intellectual property rights are also poorly enforced, raising the probability of financial losses due to copyright violations and piracy. Taking these factors into consideration, BMI awards Zimbabwe a score of 22.9 out of 100 for overall Trade and Investment Risk, placing the country 45th out...

Zimbabwe Industry Coverage (12)

Agribusiness

Zimbabwe Agribusiness

BMI View:

BMI View: We expect Zimbabwe to remain a net corn importer over the longer term. Over the next five years, we expect production of the grain to demonstrate moderate growth, although production will remain well below the totals seen in the early 2000s. We are more optimistic regarding the sugar sector, where access to key markets and potential for productivity improvements will drive production over the long term. Although we forecast a domestic sugar market surplus, the sector remains below potential and our f...

Autos

Zimbabwe Autos

BMI View:

BMI View: Weak domestic demand as a result of a gloomy economic outlook will see an average decline of 3.4% in vehicle sales over our forecast period to 2020.

Dim Outlook For Vehicle Sales
Vehicle Sales
Source: Renault, BMI

Key Views

Key Views
* Vehicle sales will contract by 19.8% in 2016
...

Commercial Banking

Zimbabwe Commercial Banking

BMI View:

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Commercial Banking Sector Indicators
Date Total assets Client loans Bond portfolio Other Liabilities and capital Capital Client deposits

Food & Drink

Zimbabwe Food & Drink

BMI View:

BMI View : Zimbabwe's food and drink industry will continue to decline due to soft domestic demand, food shortages and a booming informal food and drink sector. We do not expect to see a recovery in Zimbabwe's food and drink industry over our forecast period as the country continues to navigate a tough economic climate. We forecast Zimbabwe's real GDP to grow at 1.1% in 2016, barely recovering from the recession the country entered in 2015. Despite downward pressure on prices, the mass grocery retail sector is set to grow at a subdued rate, driven by aggressive price competition in the sector and the entrance of new players.

Headline Industry Data (...

Infrastructure

Zimbabwe Infrastructure

BMI View:

BMI View: The country's construction industry remains high risk, poorly financed and subject to the unattractive investment policies of President Robert Mugabe, with average annual real growth between 2015-2024 expected to be a mediocre 2.6%. Zimbabwe is keen to encourage foreign investment, with China so far leading inroads into the country's power and mining sectors. However, even Chinese investment is lower than expected and Mugabe's rhetoric strongly points to continued restraints on foreign investment.

Latest Updates

  • We expect continued weak growth in the Zimbabwe construction industry as high risks, little financing availability and poor growth prospects ward off investors. As such, we forecast 1.4% real growth for 2015, and an annual average growth of 2.6% over...

Insurance

Zimbabwe Insurance

BMI View:

BMI View: We are currently forecasting healthy growth in Zimbabwe's nascent insurance industry, with double digit growth expected in both the life and non-life sectors. Retention ratios are high and claims ratios are relatively low, creating a healthy operating environment, however there are shortfalls in the regulatory environment which can create investor uncertainty. The market is also dominated by several large firms which limits opportunities for new entrants. We also caution that wider economic issues alongside political uncertainty have the potential to derail current positive forecasts.

Headline Insurance Forecasts (Zimbabwe 2012-2019)
2012 2013...

Mining

Zimbabwe Mining

BMI View:

BMI View: Zimbabwe's mining industry will grow steadily in absolute terms over our forecast period through to 2019 as production increases across the key platinum and diamond mining sub-sectors. However, we note a number of potential downside risks on the horizon, including falling mineral prices and an uncertain political and regulatory climate.

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Zimbabwe Mining Industry Value
2013e 2014e 2015f

Pharmaceuticals & Healthcare

Zimbabwe Pharmaceuticals & Healthcare

BMI View:

BMI View: Although the government's ambition to develop a national health insurance scheme to facilitate universal health coverage is a positive step, Zimbabwe's healthcare system, in its current state, is heavily dependent on donor funds, owing to past failures to sufficiently finance its health sector. Global recession is presenting a significant risk as the availability of funds from foreign organisations dries up. Political instability and a grim economic outlook enforce our view that Zimbabwe will remain an unattractive market for multinational drugmakers.

Headline Expenditure Projections

Pharmaceuticals: USD361mn in 2014...

Power

Zimbabwe Power

BMI View:

BMI View: Zimbabwe's power crisis will worsen throughout 2016 as prolonged periods of low rainfall decreases the country's hydropower capacity. Struggling to pay for the cost of importing will also add to the country's power shortage woes.

Headline Power Forecasts (Zimbabwe 2014-2020)
2014e 2015f 2016f 2017f 2018f 2019f ...

Telecommunications

Zimbabwe Telecommunications

BMI View:

BMI View : BMI 's Southern Africa report analyses the latest industry, regulatory and macroeconomic developments in the telecoms markets in Angola, Botswana, Mozambique, Mauritius and Namibia. It also contains our estimates based on the latest market data and updated five-year forecasts to 2020 for the mobile, fixed-line and broadband sectors. From the five states, Mauritius and Mozambique stand out as dynamic and higher performing markets in terms of penetration and 3G/4G developments along with growth rates.

Latest Updates & Industry Developments

  • Important downward revisions were made to Angola's...

Zimbabwe Telecommunications

BMI View:

BMI View: Zimbabwe's market is due to undergo some significant changes in the near future, with the government acquiring a controlling stake in the underperforming operator Telecel. To the upside, however, there are reports on a fourth operator potentially entering the market, which would add competition. Both Zimbabwean and Zambian mobile markets are set to benefit from tower sharing arrangements, which will enable operators to cut costs and expand to underserved areas, which should consequently boost mobile growth.

Latest Updates & Industry Developments

  • Zambia's mobile market grew by 22.0% y-o-y in Q215, making a strong recovery from the SIM registration process in 2013, and...

Tourism

Zimbabwe Tourism

BMI View:

BMI View: Zimbabwe's tourism industry continues to fall short of development potential. While the country is home to many national parks with extensive safari options, as well as the ever popular Victoria Falls, it struggles to attract high spending international visitors due to perceived security risks and lack of accessibility. The hotel market also remains underdeveloped, with foreign groups deterred by extensive investment and ownership restrictions. We do expect to see some growth in arrivals over the forecast period, but until the investment environment is improved and supporting infrastructure expanded, Zimbabwe will continue to lose out to more established regional markets.

Key Forecasts (Zimbabwe 2012-2019)
...

Latest Zimbabwe Articles

  • We have revised down our CME milk price forecast for 2016 and now see price...

  • We believe that there is currently disconnect between oil prices and fundam...

  • The deflationary conditions that Zimbabwe has been experiencing for the pas...

Latest Zimbabwe Blogs

  • BMI Research has just published a special report, Top 10 Political Successi...

  • Below is a selection of key financial market stories published in Business ...

  • As the dust settles following Zimbabwe’s controversial election, we discuss...

Latest Zimbabwe Podcasts

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