Direct domestic investment rockets 2. 406 percent

Zimbabwe’s domestic direct investments skyrocketed by 2.406 percent to USD 102.38 million in the first quarter of 2026, while total projected investment value jumped 62 percent compared to the previous quarter, signalling a decisive shift toward larger, more capital-intensive projects under the Zimbabwe Investment and Development Agency’s new facilitation drive.

“Domestic Direct Investments increased significantly, with contributions rising by 2 406 (from USD 4.08 million to USD 102.38 million) and there was a notable 62 percent increase in projected investment value compared to the previous quarter, driven by fewer but more capital-intensive projects,” said ZIDA Chief Executive Officer Mr Tafadzwa Chinamo, presenting the agency’s Quarter One Report.

“This reflects sustained investor confidence alongside increased use of leveraged financing.”

The capital structure of new investments saw capital equipment imports accounting for 46 percent of total investment, followed by foreign currency cash injections at 25 percent and foreign loans at 22 percent.

However, the agency recorded a sharp decline in overall investment licensing activity.

The number of new licences issued fell by 32.2 percent year-on-year, from 214 to 146, while total projected investment value decreased by 59.6 percent compared to the first quarter of 2025.

“As we reflect on the first quarter of 2026, I am pleased to report that ZIDA has made significant and measurable progress in strengthening the investment environment, despite a challenging global economic and geopolitical landscape.

“This progress has been driven by key policy developments, enhanced investor engagement and improvements in investment facilitation. The period also reflects a shift towards higher-value investments and more structured investment activity, while highlighting the need to strengthen conversion and execution going forward,” he said.

A major milestone during the period under review was Cabinet’s approval of the Public-Private Partnership Guideline, which provides a clear and standardised framework for the preparation, appraisal, and implementation of PPP projects.

“This is a significant development for Zimbabwe’s investment landscape, as it enhances transparency, improves coordination across Government, and strengthens investor confidence through clearer processes and risk allocation mechanisms,” Mr Chinamo said.

The guideline is expected to accelerate infrastructure delivery and create a more predictable environment for private sector participation.

The Agency continued advancing ease-of-doing-business reforms.

Significant fee reductions were enacted under the ZIDA General Investments (S.I. 17 of 2026) and Special Economic Zones (S.I. 18 of 2026) Regulations.

“This downward review of licensing fees is a deliberate intervention to reduce the cost of entry and enhance Zimbabwe’s competitiveness, reaffirming the country’s commitment to being a cost-competitive investment destination and signalling that Zimbabwe is open for business,” Mr Chinamo added.

In collaboration with the Ministry of Finance, Economic Development and Investment Promotion, ZIDA launched the Business and Knowledge Process Outsourcing Framework.

Leveraging a youthful, English-speaking workforce with a 93.7 percent literacy rate, the premises-based model aims to position Zimbabwe as a premier outsourcing hub connecting European and Asian time zones, supported by targeted fiscal incentives.

The mixed performance, Mr Chinamo noted, indicates the need to boost conversion rates.

The agency continues to focus on higher-value investments while addressing the decline in overall licence issuance through ongoing policy reforms and investor facilitation improvements.