Zimbabwe economy expected to grow by 6 percent in 2025

Judith Phiri, Business Reporter

Zimbabwe’s economic growth is expected to accelerate to 6 percent in 2025 from 2 percent this year, aided by improved agricultural output and power generation as the country recovers from a severe drought.

Presenting the 2025 National Budget at the New Parliament Building in Mount Hampden, Harare, on Thursday afternoon, Finance, Economic Development, and Investment Promotion Minister, Professor Mthuli Ncube said the 2025 economic growth projections were underpinned on several factors.

“In the outlook, economic growth is now projected at 6 percent in 2025, slightly below the initial forecast of 6.5 percent. The projected strong economic performance is expected to emanate from the recovery in the agriculture sector, which is poised to grow by 12.8 percent, electricity generation by 10.6 percent, information technology by 9.9 percent and by mining 5.6 percent,” he said.

He said the anticipated La-Nina weather phenomenon, usually associated with normal to above-normal rainfall, is going to be the major driver of growth in agriculture and electricity generation.

Looking at the gross domestic product (GDP) performance from the demand side, the Minister said private consumption and Government consumption are projected to grow by 2.5 percent and 5.4 percent in 2024, respectively.

In 2025, however, Prof Ncube said private consumption is projected to drive economic growth by 6.6 percent due to strong recovery in household spending, while the public sector is anticipated to register a growth of 5.3 percent.

He added: “Gross fixed capital investment is expected to grow from 0.5 percent in 2024, to 4.6 percent in 2025, driven by private sector investment on the back of an expected stable macro-economic environment.”

Minister Ncube said in terms of sectorial contribution to GDP growth in 2025, the agriculture sector is expected to contribute 1.3 percent, wholesale and retail trade 1.1 percent, while mining and information sectors are expected to account for 0.7 percent each.

He said the contribution of agriculture to GDP growth indicates the vital role the sector plays in the economy, particularly in providing food security, employment, and export revenues.

Prof Ncube said: “Economic growth beyond 2025 is projected to remain steady at 5 percent, mainly driven by private consumption and investment.”

The 2025 National Budget, running under the theme, ‘Building Resilience for Sustained Economic Transformation’, seeks to respond to these challenges and opportunities by laying a solid foundation for future sustained and inclusive growth and development.