Finance, Economic Development, and Investment Promotion Minister, Professor Mthuli Ncube, has highlighted that the 2025 National Budget focuses on stabilizing the economy and enhancing resilience to future challenges.
Speaking at a post-budget breakfast meeting organized by Business Weekly, in collaboration with the Confederation of Zimbabwe Industries (CZI) and the Ministry of Finance, Prof. Ncube acknowledged the significant economic impact of recent challenges, including an El Niño-induced drought that reduced growth from over 5% in 2023 to around 2% in 2024. Additionally, declining global commodity prices—excluding gold—have further strained an economy heavily reliant on mineral exports, which constitute over 90% of export earnings.
Key Budget Allocations and Objectives
The budget allocates approximately 11% of its total resources to agriculture, emphasizing food security and resilience. Prof. Ncube stated that initiatives like investments in irrigation would support citizens dependent on farming, enabling the sector to withstand climate and economic uncertainties. This strategy aims to boost agricultural productivity and safeguard the nation’s food supply.
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In addition to agriculture, the budget prioritizes industrial diversification, with plans to foster emerging industries, such as pharmaceuticals and automotive manufacturing. To achieve this, the government proposes a development fund co-managed by the Finance Ministry and the Ministry of Industry and Commerce. This fund is expected to drive investments in critical sectors and reduce reliance on imports by stimulating local production.
Economic Diversification and Industry Support
The budget also outlines incentives to promote local manufacturing, particularly in the automotive industry, encompassing cars and buses. Prof. Ncube described these efforts as part of a broader agenda to reduce import dependency while stimulating industrial growth.
Another key focus is advancing Zimbabwe’s devolution agenda to ensure equitable development across all regions, preventing the marginalization of specific communities or areas in national development efforts.
Managing National Debt and Asset Disposal
To finance critical programs in agriculture, infrastructure, health, and education, Prof. Ncube revealed that the government is considering the strategic disposal of select state assets. Proceeds from these sales would also be used to address national debt, which he described as a major constraint on economic progress. “Debt is a significant burden that we must address to enable the economy to move forward,” he noted.
Challenges in the Mining Sector
Prof. Ncube expressed concerns about the mining sector, which contributes over 60% of Zimbabwe’s export earnings. He highlighted declining global demand for hard commodities, particularly from China, as a pressing challenge, though gold has performed well this year. Other key minerals, such as lithium, platinum, and palladium, have faced price stagnation, impacting the sector’s overall economic contribution.
Environmental and Public Health Measures
The 2025 budget also includes green initiatives, such as taxes on plastic carrier bags, inspired by international practices, to address environmental concerns without disrupting local packaging industries. Additionally, taxes on unhealthy foods are aimed at promoting healthier lifestyles among Zimbabweans.
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