Industry capacity utilisation rises to 58%
ROBIN PHIRI
Zimbabwe’s industrial capacity utilisation has risen sharply, improving from 53.8% in 2024 to 58% in 2025, driven by macroeconomic stability, according to the latest Zimbabwe National Chamber of Commerce (ZNCC) business confidence survey.
Survey lead researcher Dr Moses Chundu attributed the improvement to a stable exchange rate, which respondents identified as a key driver of recovery.
“That’s quite significant growth in one year. If this momentum can be sustained, we’re probably looking at a better 2026. Checking on what was driving this, why this jump from 53% to 58%, the top leads in terms of drivers is macroeconomic stability and a related variable, which is stable exchange rates. So these are the biggest drivers, but it also means they are the most sensitive. Anything goes wrong with these two, we’ll be back to 2024,” Dr Chundu said.
A majority of firms, 41%, reported higher capacity utilisation compared to last year, while 20% said it remained unchanged, and 39% reported declines. However, four sectors recorded downturns, including energy (electricity and gas), education, wholesale and retail, and transport and storage, raising concerns among policymakers.
On the performance of the Zimbabwean Unit of Account (ZiG), the survey indicated that nearly 60% of businesses have adopted the currency, with many acknowledging that it has improved planning, reduced pricing distortions, and lowered the cost of doing business.
A striking 77% said the stability of ZiG balances has enhanced planning accuracy, while another 60% noted improvements in overall business operations.
On the other hand, firms expressed strong pessimism about the currency’s future, with 62% saying the ZiG will not remain stable, 79% expecting the exchange rate to weaken, and 74% doubting that current macroeconomic stability will be sustained.
“We need to understand what is driving that kind of pessimism. Is it the right time to fully dollarize? Again, respondents were anti-de-dollarization. A whopping 76%, very worrying number,” Dr Chundu said.
Ease of doing business remains a major concern, with an overwhelming 84% saying the environment remains unfriendly—a slight deterioration from 83% last year. Chundu noted that some recent licensing reforms were too new to influence the survey outcome but warned that broader structural issues, including corruption, infrastructure gaps, and policy inconsistencies, continue to weigh on investor confidence.
Despite these concerns, overall business confidence improved, with the index rising to 7.36 in 2025 from 1.4 last year, supported by optimism around an expected good agricultural season and recent reforms.
Medium-sized firms showed the strongest optimism, while large firms remained the most pessimistic.
