Zimbabwe recorded its first trade deficit contraction in 2025, largely due to the strong performance of the mining sector, particularly gold and nickel exports, which offset declining imports.
By Ryan Chigoche
According to newly released Zimstat data, the country’s trade deficit narrowed sharply to US$118.7 million in April 2025, a 49.5% decline from the US$235.2 million registered in March. This marks the first monthly contraction in the trade deficit this year, following a persistent widening trend since January.
A contraction in the trade deficit means that the gap between imports and exports has narrowed, often due to increased export earnings, reduced imports, or a combination of both. This signals improved trade performance and can ease pressure on foreign currency reserves.
The improvement in trade performance was underpinned by a surge in mineral exports, with gold and nickel mattes leading the way. Export earnings rose sharply, while imports dipped for the second consecutive month.
A key driver of the gold boom is the escalation of global geopolitical tensions, which has prompted investors to seek safe-haven assets like gold. As a result, gold prices soared to a historic high of US$3,500 per ounce in April, providing a windfall for Zimbabwe’s gold producers.
Gold output for April surged to 3.82 tonnes, the highest monthly total since December 2021, when 4.3 tonnes were produced. This production boost translated into US$303.9 million in gold export revenues, making it the second-highest monthly figure in the country’s history, after the US$361 million recorded in November 2024.
In addition to gold, nickel mattes—another critical mining export—played a key role in lifting export earnings. These gains reflect the continued importance of mineral commodities in sustaining Zimbabwe’s economy.
Total exports for April reached US$662.6 million, with the United Arab Emirates (49.8%), South Africa (24.0%), and China (15.9%) emerging as the top three destinations. Together, these countries accounted for approximately 90% of the total export value, reaffirming the strategic importance of Zimbabwe’s mineral trade with key global partners.
On the import side, Zimbabwe saw a 4.5% decline in April, with total imports falling to US$781.3 million from US$818.3 million the previous month. This was largely due to a steep 43% drop in maize imports, which fell from US$686.9 million to US$393.3 million.
Other key declines included soya bean oil and commercial vehicle imports. However, import expenditure shifted toward petroleum oils, machinery, and cereal inputs that are often essential for industrial operations, including mining, indicating a reallocation of resources rather than a broad-based decline in demand.
Despite this positive shift in the trade balance, Zimbabwe’s mining sector continues to grapple with structural challenges.
Restrictions on selling gold directly to the London Bullion Market limit earnings potential and increase costs for local producers. Additionally, persistent electricity shortages compel mining firms to rely on expensive backup power, pushing up operational costs and constraining productivity.
To sustain and build upon the recent gains, the government needs to implement a series of targeted reforms.
Ensuring a consistent electricity supply to mines is essential, as is reducing tax burdens and streamlining regulatory procedures to create a more competitive operating environment.
Addressing gold smuggling—estimated to be costing the country billions annually—is also vital, along with reconsidering gold surrender requirements, which many in the industry view as overly punitive.
Gold remains Zimbabwe’s most important export commodity, accounting for roughly one-third of export earnings and contributing around 60% of the country’s foreign currency inflows.
The sector is supported by both large-scale miners, such as Kuvimba Mining House, Padenga Holdings, and Freda Rebecca, and by thousands of artisanal and small-scale miners whose collective output forms a significant share of total gold production.
Supporting both groups through improved access to finance, better infrastructure, and more inclusive policies will be crucial to boosting national output.
In line with this, ZimTrade aims to grow Zimbabwe’s exports by at least 10% annually, targeting US$14 billion by 2030.
Given mining’s dominant share of foreign exchange earnings, the sector is expected to be a cornerstone of this strategy and of broader efforts to transition Zimbabwe into an upper-middle-income economy.
The Zimstat April trade data signals what is possible when mining thrives, but sustaining this momentum will depend on addressing long-standing bottlenecks and fostering an enabling environment for miners at all levels.
