World Bank hails Zimbabwe’s 6.6% growth, slams business ‘transparency gaps’

HARARE – The World Bank’s latest Zimbabwe Economic Update (ZEU) has applauded the country’s strong economic rebound while simultaneously warning that persistent regulatory bottlenecks, particularly inadequate transparency, risk undermining the gains.

The report, released on Tuesday, projects Zimbabwe’s economy to grow by 6.6% in 2025, driven by robust performance in agriculture, services, and continued investment in mining and steel.

Growth is expected to remain solid at 5% in 2026, positioning Zimbabwe ahead of many Sub-Saharan African peers.

The World Bank noted that tight monetary policy since late 2024 has helped stabilise the Zimbabwe Gold (ZiG) currency and improve inflation dynamics.

Inflation is forecast to fall into single digits in 2026 and toward 5% over the medium term, supporting gradual poverty reduction, although the report stresses that rural households remain vulnerable to droughts, inflation, and limited social protection.

World Bank Senior Country Economist Victor Steenbergen said the improving macroeconomic conditions create an opportunity for the government to intensify efforts to strengthen the ease of doing business, which he described as essential for translating headline growth into “lasting economic benefits.”

“Now that the macroeconomy is improving, the Government’s position in re-prioritizing efforts to improve the ease of doing business to improve Zimbabwe’s private sector growth and competitiveness are more than necessary to enhance the overall growth and eventually translate economic growth into lasting economic benefits,” Steenbergen noted.

While commending Zimbabwe’s progress under the Presidential Ease of Doing Business Initiative, the report has raised red flags over regulatory opacity and administrative inefficiencies across several sectors.

A special section of the ZEU analysing regulatory burdens reveals that some subsectors, including agriculture, agro-processing and tourism, face up to 28 different legal and compliance requirements from multiple Ministries, Departments and Agencies (MDAs).

The World Bank has identified major challenges including the inadequacy of transparency and use of manual processes. Many regulatory requirements remain paper-based, with limited online information, forcing businesses to make physical visits to multiple offices.

It also cited the high and regressive fee structures. The World Bank said compliance fees in some subsectors are so extensive that they may exceed annual revenues, particularly for SMEs.

“Strengthen central oversight of regulatory reforms and shift agencies towards a service‑delivery mindset.

“These reforms also require clarifying institutional mandates, reviewing agency fee structures, and ensuring regulations serve the public interest rather than institutional revenue needs,” the organisation noted.

The issue of overlapping mandates was also raised. Several MDAs issue similar permits and inspections targeting the same policy objectives, increasing procedural costs without clear public benefit.

The Bank has acknowledged ongoing reforms, including regulatory streamlining completed in the beef, dairy, stockfeed and tourism sectors, but stressed that the next phase of simplification across 12 priority sectors must be completed within 12 months to maintain reform momentum.

The ZEU urges Zimbabwe to adopt a broader medium-term agenda anchored on three pillars, transparency, simplification and governance, to foster a more business-friendly regulatory environment.

Key recommendations include establishing a central public registry of all licenses, fees and inspection requirements, consolidating overlapping procedures, adopting risk-based compliance regimes, and strengthening institutional oversight of regulatory reforms.

There are however concerns from political and economic commentators that reports by the World Bank are often based on figures supplied by the government and that these are always “massaged before being handed to the World Bank or IMF.”

Journalist Hopewell Chin’ono says its important for people “understand why our official data never matches lived reality. If the inputs are corrupted, the outputs will always be a lie.”

“If surveys are being done without physically visiting companies, then the data collected cannot reflect what is happening on the ground. It becomes theory, not reality. This is how economies collapse while reports still paint a rosy picture.

“Professor Steve Hanke’s work and his inflation models use real market signals, including the black market rate, which is what Zimbabweans actually feel in their pockets. That is why his numbers reflect reality while official statistics remain political fiction.

“Zimbabwe’s biggest tragedy is not just corruption, it is the institutional dishonesty that feeds bad policy. If data is manipulated at the source, the country becomes impossible to fix because decision-makers are operating on false information,” Chin’ono added.