Story by Stanley James, Business Editor
ZIMBABWE’s reengagement and engagement drive is being solidified as the government forges ahead with its economic diplomacy thrust towards restoring normal ties with all global economies.
This is further reflected by the latest move by President Emmerson Mnangagwa in announcing that the government will soon suspend all tariffs on goods from the World’s biggest economy, the United States of America (USA).
While a global economic journal defines a tariff as a duty or tax levied by the government on goods entering or leaving the country’s borders, it is the spirit of the Second Republic of enhancing bilateral economic cooperation that has led to the latest decision.
Despite the latest move by authorities being made after the US administration imposed an 18 percent tariff hike on Zimbabwean exports to the US, the government of Zimbabwe is taking a different approach as President Mnangagwa commits to bolstering relations with President Donald Trump’s administration.
To Zimbabwe the decision of suspending tariffs on goods from the USA has influenced by the need to facilitate the expansion of American imports within the economy while at the same time promoting exports of local goods to the USA.
With official data from the Zimbabwe National Statistics Agency, showing that the USA trade deficit with Zimbabwe was over US$24 million in 2024 with imports pegged at more than US$67 million, outstripping exports at over US$43 million, the need for the two economies to scale up trade is of great importance.
Therefore, the proposed suspension of tariffs on goods from the USA is actually setting the tone of serious commitment by Zimbabwe to build positive economic ties with President Donald Trump’s administration.
It also reflects the government of Zimbabwe’s interest in doing more business with the world’s biggest economy.
In the past few months, several business delegations have visited Zimbabwe with a view of setting up projects in the mining, agriculture, manufacturing, retail, financial services, and construction among others.
With the government of Zimbabwe committing to forego potential revenue by suspending the tariffs, the move resonates with the intention of welcoming prospective investors from the US to invest in Zimbabwe.
Zimbabwe’s sincerity to engage with the US is also shaping future relations riding on the diplomacy which has seen the country mending ties with several European Union economies in the past few years.
With Zimbabwe’s main exports to the US comprising tobacco, minerals and textiles, it is the spirit of enhanced cooperation that has seen the government further committing to allowing goods from the US market duty free.
This comes on the backdrop of yearly volumes of export receipts surging to more than seven billion in 2024 from a baseline averaging US$3 billion a few years ago.
Zimbabwe is therefore riding on the fruits of economic diplomacy, with the need to embrace the US in the global trading arena being of paramount importance.
Although Zimbabwe does not benefit from the African Growth Opportunities Act (AGOA), a USA trade pact that provides preferential access to the US markets for eligible Sub- Saharan Africa economies, attempts to mend economic ties with the US are for the good of Zimbabwean industry and commerce.
As Zimbabwe’s imports are now skewed in favour of raw materials and machinery, the suspension of tariffs on goods from the US markets will positively affect local firms in terms of cheaper costs of strategic components for production.
As Zimbabwe’s economic diplomacy is still in motion, it is prudent for the relevant authorities to continue fostering investment and trade cooperation with all the economies across the globe.
Zimbabwe boasts of a vast economic base, hence it is vital for the government to pursue strategies that solidify economic partnerships thereby enabling industry and commerce to expand.
As globalisation continues to gain traction, Zimbabwe needs strategic partners to reinforce the economic growth and recovery agenda as promised in the National Development Strategy One aspirations of achieving yearly growth rates of at least five percent.
