Zimbabwe has an opportunity to turn recent economic stability into stronger investment, higher productivity and more formal jobs, according to a new World Bank...
Zimbabwe has an opportunity to turn recent economic stability into stronger investment, higher productivity and more formal jobs, according to a new World Bank Group report, The Zimbabwe Growth and Jobs Report.
The report says Zimbabwe’s economy grew by an average of almost six percent between 2021 and 2025, while local-currency inflation fell to single digits in early 2026, the first time this has happened since 1997.
The World Bank said the improvements, supported partly by stronger fiscal and monetary discipline, provide a foundation for more sustainable growth after decades of economic turbulence.
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World Bank Senior Country Economist Victor Steenbergen said stabilisation was necessary but could not by itself deliver broad-based employment and income growth.
“We see that after decades of volatility, Zimbabwe has achieved a degree of stability,” Steenbergen said.
He said the economy grew by more than eight percent in 2025, supported by a strong agricultural season and a favourable external environment. He also pointed to the Government’s 10-month staff-monitored programme with the International Monetary Fund as helping to strengthen policy credibility and support international re-engagement.
“But stabilisation is essential, but it’s not sufficient for high and inclusive growth in jobs, but it has opened a window of opportunity,” Steenbergen said.
The report, however, says economic growth has not yet translated into widespread improvements in household incomes or productive employment. About 80 percent of Zimbabweans remain employed in the informal sector, where average monthly earnings are around US$130.
It also says labour has largely moved from agriculture into low-productivity retail and informal services rather than formal manufacturing and higher-value services.
Zimbabwe’s Head of the Public Debt Management Office, Andrew Bvumbe, said the focus should be on helping businesses in the emerging sector expand, connect with larger companies and create more employment.
“So we are calling it an emerging sector,” Bvumbe said. “They are creating jobs; they are producing. So for us going forward, we should focus on how we assist them to grow, to link up with big corporations and to create more jobs.”
The World Bank also warned against rushing Zimbabwe’s plan to end domestic use of foreign currencies. The country has set 2030 as the deadline to phase out the use of the US dollar and make the bullion-backed ZiG its sole currency.
Steenbergen said confidence in ZiG remained at an early stage and that the de-dollarisation programme had created uncertainty.
“The challenges that we see in Zimbabwe here are that the currency credibility is still nascent and needs to be further anchored,” he said.
He recommended maintaining fiscal and monetary discipline, implementing the de-dollarisation process in a transparent and market-driven manner, and resolving multilateral debt arrears to improve debt sustainability.
Bvumbe agreed that the currency transition should not be forced, saying transparency and market participation would be important.
“The issue of transparency and the way we move towards that aspiration of a monocurrency has to be transparent, and you can’t force it,” he said.
He added that markets should have a role in the process and said the transition should involve all stakeholders.
The report also highlights Zimbabwe’s continued poverty challenges, with nearly half of the population living below the international poverty line.
In July 2026, the World Bank removed Zimbabwe from its list of fragile and conflict-affected situations, marking an improvement in its assessment of the country’s economic and institutional conditions.
However, debt remains a major constraint. IMF estimates show that Zimbabwe’s external arrears to official creditors had reached about US$7.7 billion by the end of 2025, while arrears to external commercial creditors stood at approximately US$22.8 billion.
The World Bank says resolving these challenges while maintaining economic stability will be important if Zimbabwe is to convert recent growth into higher productivity, stronger household incomes and more formal employment.
