Harare – Zimbabwe’s Treasury has announced that the upcoming 2025 national budget will prioritise building resilience to strengthen structural economic transformation and consolidate the progress achieved under the National Development Strategy 1 (NDS1).
The budget aims to bolster the economy against both domestic and international challenges, said Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, at a lecture held at the Zimbabwe National Defence College in Harare.
With Zimbabwe’s economy now anticipated to grow by 2% this year—down from the initial 3.5% projection due to severe drought—Treasury projects a substantial recovery in 2025, with growth expected to reach 6%, largely due to anticipated agricultural sector improvements.
Prof Ncube highlighted that the upcoming budget would include measures to enhance the country’s economic resilience against shocks, particularly climate-induced disruptions. “We are focusing on resilience because we have been impacted by climate changes this year,” he said. “This includes investments in irrigation, drought-resilient seeds and crops, conservation agriculture through initiatives like Pfumvudza/Intwasa, and developing insurance products for farmers. These are key strategies for building resilience.”
Strategic Focus on Agriculture and Infrastructure
The budget is expected to allocate significant resources to agriculture, with a special focus on supporting water infrastructure and environmental conservation to harness the potential of natural resources. According to Prof Ncube, these investments are pivotal for long-term resilience and sustainable growth, especially in light of the challenges posed by climate change.
In addition, the Treasury aims to strengthen the stability of Zimbabwe’s currency by supporting its value with precious metals and foreign currency reserves. Emphasis will also be placed on boosting exports to reinforce currency resilience as a foundation for economic growth and stability.
Diverse Sector Growth and Agricultural Recovery
While agriculture is the only sector anticipated to experience negative growth in 2023, other areas of the economy, such as information and communications technology (ICT), tourism, and accommodation, are recording impressive growth, with each expected to grow above 10%. Prof Ncube expressed optimism that agriculture would rebound in 2025, aided by an expected increase in rainfall, potentially achieving a growth rate of around 13%. This recovery is projected to contribute significantly to the overall 6% economic growth target.
During the NDS1 period (2021-2025), Zimbabwe’s economy has grown at an average rate of 6.5%, setting the country on track to meet its average growth target of 5.5%. This target is aligned with Zimbabwe’s Vision 2030 goal of achieving middle-income status.
Boost in External Balances and Current Account Surplus
Prof Ncube noted that Zimbabwe’s economic health has also benefited from robust export growth in sectors like mining, as well as steady remittances from the diaspora. These inflows have been instrumental in maintaining a positive current account balance, with the surplus expected to exceed initial projections. Originally anticipated to shrink to US$45 million, updated figures suggest a surplus closer to US$100 million, driven by increased gold earnings and higher export values.
“In the last six years, we have maintained a positive current account surplus,” said Prof Ncube. “This year’s current account is bolstered by gold earnings, and the surplus could reach as much as US$100 million, reflecting the resilience of our external balances.”
Roadmap to Middle-Income Status
As Zimbabwe enters the final stages of NDS1 and looks towards NDS2 (2026-2030), Prof Ncube affirmed that the nation remains committed to maintaining its growth momentum. The successful implementation of NDS1 has set the foundation for Zimbabwe’s pursuit of middle-income status by 2030, with the country steadily progressing toward this goal despite external and domestic economic challenges.
The 2025 budget, expected to be released soon, will play a pivotal role in Zimbabwe’s strategic economic plans, laying the groundwork for sustainable, inclusive growth that can withstand future shocks and propel the country towards long-term prosperity.
Source: Herald