Introduction
As Zimbabwe seeks to revive its economy and attract global capital, the country’s foreign investment policies have undergone significant transformation. With the establishment of the Zimbabwe Investment and Development Agency (ZIDA) and the repeal of restrictive laws like the Indigenisation and Economic Empowerment Act (IEEA) for most sectors, the nation has repositioned itself as an open and opportunity-rich investment destination.
This article provides a detailed overview of Zimbabwe’s foreign investment policies in 2025—covering regulatory frameworks, sector-specific restrictions, incentives, taxation, and procedural requirements for international investors.
1. Policy Direction: From Protectionism to Liberalization
Historically, Zimbabwe had a protectionist investment approach, marked by strict indigenisation requirements and bureaucracy. However, in response to economic stagnation and capital flight, the government began implementing reforms to:
- Open strategic sectors to foreign investors
- Simplify investment procedures
- Improve investor protection laws
- Create a one-stop-shop for investment facilitation (ZIDA)
In 2025, Zimbabwe’s investment climate is markedly more liberal and investor-friendly, especially for capital-intensive, export-oriented, and infrastructure-related projects.
2. Zimbabwe Investment and Development Agency (ZIDA)
Established through the ZIDA Act of 2020, ZIDA serves as the central authority for:
- Licensing foreign and domestic investments
- Coordinating regulatory approvals
- Facilitating investor protections and dispute resolution
- Promoting public-private partnerships (PPPs)
Key Benefits of ZIDA:
- One-stop-shop model for quicker processing
- Sector experts assigned to large projects
- Digital platform for application tracking
- Investment promotion through global roadshows and trade missions
ZIDA is pivotal in creating a transparent, predictable, and efficient investment ecosystem in Zimbabwe.
3. Sectoral Investment Rules and Restrictions
Open Sectors to Foreign Investment:
Foreigners can invest freely and hold 100% ownership in most sectors, including:
- Agriculture (excluding land ownership)
- Manufacturing and agro-processing
- Tourism and hospitality
- Renewable energy
- Information and Communication Technology (ICT)
- Real estate development
- Transport and logistics
- Financial services (subject to licensing)
Restricted or Regulated Sectors:
Despite liberalization, some sectors are subject to regulation, partial restrictions, or joint venture requirements:
| Sector | Restriction |
| Mining (Platinum, Diamonds) | 51% local ownership required in strategic minerals |
| Land Ownership | Foreigners cannot own freehold agricultural land; leasing is allowed |
| Media and Broadcasting | Heavily regulated; often requires local partnerships |
| Defense and Security | Restricted to local entities; foreign participation is prohibited |
However, exemptions may be granted by the government through special economic designations or strategic partnership arrangements.
4. Investment Incentives and Tax Benefits
Zimbabwe offers several fiscal and non-fiscal incentives to attract FDI, particularly in priority sectors such as agriculture, mining, infrastructure, and export manufacturing.
ZIDA-Certified Investment Incentives:
- Tax Holidays:
Up to 5 years of corporate income tax exemption for new investments in strategic sectors or special economic zones (SEZs). - Customs Duty Exemptions:
On capital equipment, machinery, and raw materials not available locally. - Accelerated Depreciation:
Investors may write off capital assets faster to reduce taxable income. - Repatriation Guarantees:
Foreign investors can repatriate profits, dividends, and capital after tax compliance. - Export Incentives:
Export-oriented businesses may qualify for zero-rated VAT and forex retention thresholds.
5. Repatriation of Profits and Capital
Foreign investors are allowed to remit earnings, subject to the following:
- Approval from the Reserve Bank of Zimbabwe (RBZ) and proof of compliance with local tax obligations.
- Proper documentation including audited financial statements and tax clearance.
- Repatriation must be processed through authorized dealers (banks).
Current Forex Rules:
- 100% of capital returns and dividends can be remitted.
- Exporters retain up to 85% of foreign currency earnings, depending on the sector.
- Capital gains can be transferred after clearance by ZIMRA and RBZ.
6. Special Economic Zones (SEZs)
Zimbabwe’s SEZs are designed to offer enhanced incentives and regulatory flexibility. Notable SEZ locations include:
- Sunway City (Harare) – ICT and light manufacturing
- Bulawayo Industrial Hub – Textile and food processing
- Victoria Falls Hub – Tourism and financial services
- Chitungwiza – Pharmaceuticals and agribusiness
SEZ Advantages:
- Exemption from capital gains tax
- 100% foreign ownership allowed
- Streamlined immigration processes for foreign staff
- Extended tax holiday periods (up to 10 years)
7. Investment Licensing and Procedures
Investors in Zimbabwe must undergo a structured licensing process through ZIDA:
Step-by-Step Process:
- Submit Application:
- Company profile
- Business plan
- Project funding sources
- Environmental and social impact statements (if applicable)
- ZIDA Evaluation:
Applications are reviewed for feasibility, local impact, and compliance. - Certificate of Investment Issued:
Grants access to incentives, land leasing rights, and import duty exemptions. - Registration with Other Authorities:
- ZIMRA (tax registration)
- RBZ (for foreign currency accounts)
- NEC (labor regulations)
- Environmental Management Agency (for EIA)
Total time: 7–30 working days, depending on sector and complexity.
8. Bilateral and Multilateral Investment Treaties
Zimbabwe is a signatory to multiple bilateral investment treaties (BITs) and multilateral trade agreements that protect foreign investments and facilitate cross-border trade:
- COMESA and SADC Protocols
- African Continental Free Trade Area (AfCFTA)
- Bilateral treaties with China, South Africa, India, UK, Germany, and more
- Membership in the Multilateral Investment Guarantee Agency (MIGA)
These treaties guarantee non-discriminatory treatment, fair compensation in case of expropriation, and access to international arbitration.
9. Key Challenges and Mitigation
Challenges:
- Currency volatility and forex access issues
- Regulatory delays in permits and environmental approvals
- Inconsistent policy enforcement in rural areas
- Infrastructure gaps in energy and transport
Mitigation Strategies:
- Partner with reputable local firms to navigate compliance.
- Focus on sectors prioritized by the government.
- Leverage SEZ frameworks for regulatory ease.
- Use ZIDA’s support channels and investor aftercare services.
10. Outlook for 2025 and Beyond
Zimbabwe’s investment climate in 2025 is progressively stabilizing, with key reforms continuing in:
- Public-private partnership (PPP) legislation
- Digital land and company registration
- Electricity grid expansion and renewable energy
- Judicial reforms for contract enforcement
Investor confidence is returning, driven by:
- Government commitment to IMF/WB reform benchmarks
- Improved agricultural output and mineral exports
- Regional integration under AfCFTA
Conclusion
Zimbabwe’s foreign investment policies have evolved from restrictive to strategically liberal, with strong legal protections, fiscal incentives, and dedicated institutional support through ZIDA. While challenges persist, the direction of reform is positive—especially for investors ready to take a medium to long-term view.
With opportunities spanning mining, agriculture, manufacturing, tourism, and technology, Zimbabwe offers a diversified portfolio for global investors seeking access to Southern Africa’s growing markets.
