ZIMBABWE'S trade deficit widened by 6% to US$2,1 billion in 2024, driven by a surge in grain and fuel imports, according to latest trade figures.
Imports rose 4% to US$9,5 billion, while exports stood at US$7,4 billion, up 3% compared to the same period in 2023, trade data from the Zimbabwe National Statistics Agency (ZimStat) showed this week.
The trade deficit, which is a situation whereby a country is importing more than it is exporting, has precipitated concerns about Zimbabwe’s ability to meet its foreign exchange obligations, amid a worsening economic crisis.
Economists have warned that the widening trade deficit could put pressure on the local currency and exacerbate inflation, which rose sharply in January in both United States dollar and local currency terms.
“The increase in imports may be due to the grain imports to complement the food security efforts caused by the drought," economist Stevenson Dhlamini said.
"The increase in exports may (also) be due to the recovery of the prices of commodities and the improving global economy.”
Another economist Prosper Chitambara underscored that the widening of the trade deficit was largely driven by the drought, which resulted in a significant drop in agricultural production.
“So, it meant that our agricultural exports were affected. But it also meant we had to import more agricultural commodities into the country,” he said.
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“It also meant that our import bill obviously increased. But the slowdown in commodity prices in general also adversely affected our export earnings.
“I think those two factors, and of course the fact that our economy last year declined, also meant that production declined, exports therefore declined, and that affected our trade position negatively.”
However, financial analyst Persistence Gwanyanya noted that despite the widening trade deficit, Zimbabwe continues to experience growth in external trade, which could signal a recovery in economic activity.
“While trade deficit has been widening, our current account has been improving over years, which reflects increased inflows from other BOP (balance of payment) items, mainly diaspora remittances,” he said.
“This only demonstrates the need to harness foreign currency generated from a favourable BOP position into the formal sector. Importantly, this demonstrates the urgency to deal with the informal sectors where a significant amount of money from favourable BOP is sloshing.”
Zimbabwe imports a wide-range of products, including machinery and mechanical appliances, raw materials, food products, fuels, minerals, textiles and clothing, footwear, electricity, chemicals, metals and intermediate products, among others.
Exports were dominated by commodities.
In his 2025 national budget, Finance, Economic Development and Investment Promotion minister Mthuli Ncube, projected that the decline in foreign currency earnings would exacerbate the current account balance.
This, he cautioned, would worsen Zimbabwe’s trade deficit and put a further strain on macroeconomic stability.
“To mitigate these risks, the government will continue to promote diversification of the economy into sectors such as technology, manufacturing and services, thereby, reducing the dependency on commodity exports and enhancing overall economic resilience,” Ncube said.
According to the statistics agency, Zimbabwe’s major trade destinations in the period under review were South Africa, United Arab Emirates (UAE) and China.
