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Zimbabwe businesses fight forex rule that cuts profits

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By GAMUCHIRAI MASIYIWA

Tobacco grower Shava Manomano fumes as he sits on a bale of yellow-gold leaves, watching buyers move along an auction floor in Harare, Zimbabwe’s capital.

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The buyers, wearing face masks, partially fill the cavernous, well-lit space.

The aroma of tobacco bathes the room.

Manomano sold his tobacco for United States dollars.

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But he’s angry because the Zimbabwean government converts 40% of that foreign income into local currency.

“My tobacco is bought and paid for in US dollars,” he said, “but then I get a portion of that payment in local currency, which is heavily affected by inflation.

“At the end of the day, I incur losses.”

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To stretch his foreign currency, the farmer from Chiweshe, in northern Zimbabwe, turns to the unofficial parallel, or black, market.

But “the prices that you get on the parallel market are ridiculous.”

In January, the Reserve Bank of Zimbabwe, the country’s central bank, raised from 30 percent to 40 percent the portion of foreign earnings that is automatically changed into local currency — known as the export surrender.

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Officially, the increase affects all sectors involved in exports, including agriculture, mining, manufacturing and transport.

It has pinched the profits and growth of small enterprises in particular.

It also threatens to undermine President Emmerson Mnangagwa’s mantra that the country is “open for business.”

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For two decades, corruption, hyperinflation, government overspending and uneven application of reforms have stunted Zimbabwe’s economic growth, and this latest policy has drained the confidence of potential foreign investors.

Zimbabwe already was scuffling to attract investors, according to the United Nations Conference on Trade and Development.

Between 2018 and 2019, the country saw foreign investment collapse from US$745 million to US$280 million.

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“The huge factors that scare away investors include toxic politics and policy inconsistency,” said Ithiel Mavesere, an economics lecturer at the University of Zimbabwe in Harare.

“To ensure confidence among the people, we need to come up with credible policies, be consistent in policy and have credible institutions.”

In an analysis of Zimbabwe on its website, the US International Trade Administration notes: “Foreign currency retention requirements have challenged exporters, particularly when this gap has grown to such extremes, and international firms have faced challenges repatriating profits.”

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And during a virtual event in May, Chris Hunnicutt, senior economic officer at the US embassy in Zimbabwe, noted challenges that affect investment in the country include “policy flip-flopping where things change unexpectedly.”

By increasing the export surrender, the government hoped to raise funds for the Foreign Exchange Auction Trading System, launched last year to bring stability, efficiency and transparency to foreign transactions.

The Reserve Bank’s governor and deputy governor didn’t respond to interview requests.

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A higher export surrender bloats business costs and “also encourages practices where people bank their money offshore to try and evade these policies,” economist Prosper Chitambara said.

Kudakwashe is one of those people.

Kudakwashe, who asked to be identified only by his first name for fear of arrest, started a trucking business in December 2020 but skirts the new policy by slipping his foreign earnings into an offshore account.

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“I realized that it was better to keep my money elsewhere, where I know I can withdraw it, as it is without a portion being converted into local currency,” he said.

“If such policies were not in place, I would have had foreign currency accounts locally. But such policies will hinder growth, especially for startups like me.”

Tinashe Rukwere, who owns a trucking company, said the new directive chews up his profit and complicates operations, as most of his needs require foreign exchange.

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He must buy fuel, for example, with foreign currency.

The new policy “affects funds for operations and, for someone who is starting investments, they may fail to continue with operations,” Rukwere said.

For his tobacco, Manomano received US$900 and $51,000 (about US$600).

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He wanted to buy five tonnes of fertilizer and equipment, but he could purchase only two tonnes.

“I also have debts back home which I have not yet paid, so I do feel the impact,” he said.

Talita Katsenga, who lives in Mvurwi, a town in northern Zimbabwe, wants to be paid at least 80 percent in foreign currency because most supplies she and her fellow tobacco growers need are bought in US dollars.

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A lack of foreign currency means she may be unable to afford fertilizer, chemicals and labour.

All of which could force her to delay her harvest.

“Given the prevailing economic situation, it will be difficult to be able to go back in the field,” she said. “As farmers, we are between a rock and a hard place.”- Global Press Journal

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Tens of Thousands in Zimbabwe Go Hungry as the Rains — and US Aid — Hold Back

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Tanayeishe Musau eats baobab porridge after school at his home in Mudzi, Zimbabwe, where the dish has become a daily staple amid worsening drought and hunger. Once a simple supplement, baobab porridge is now a primary meal for families like his, following widespread food shortages and the suspension of international aid.

BY LINDA MUJURU

This story was originally published by Global Press Journal.

Agnes Tauzeni stands on her parched field. She is a mother to two children, and is expecting another. But now, in a time that might otherwise have been joyful, her hopes wither like the struggling crops before her.

 

Three times she’s gambled on the rains; three times the sky has betrayed her. Her first two plantings failed. The soil was too dry to sustain life. Though her third attempt yielded a few weak shoots, they offered little promise of a meaningful harvest. El Niño-driven droughts have disrupted once-reliable rains, leaving Tauzeni’s family and many like hers struggling to feed themselves.

 

“I am always hungry,” Tauzeni says.

 

She worries about the health of her unborn child, based on how little nutrition she consumes herself.

 

Adding to this, food aid, previously funded by the US Agency for International Development, halted suddenly in January. That transformed what was already a struggle into a desperate battle for survival.

 

The food aid ended when US President Donald Trump, on his first day in office, issued an executive order that paused nearly all US foreign aid, most of which was administered by USAID. That agency is now all but defunct.

 

Food aid in Zimbabwe was an ongoing area of funding for USAID. In November 2024, the agency announced $130 million for two seven-year programs, implemented by CARE and Cultivating New Frontiers in Agriculture, that would provide food aid and other related support to areas of Zimbabwe most in need. The programs, which stopped, were just part of an ongoing slate of activities designed to help Zimbabwe’s neediest people.

 

About 7.6 million people in Zimbabwe — nearly half the country’s population — need humanitarian assistance, according to a 2025 UNICEF report. Of those, nearly 6 million, like Tauzeni, rely on subsistence farming.

 

Through the support of organizations with funding from USAID, people previously received cereals, edible seeds, oil and food vouchers.

 

“A sudden withdrawal can put the entire community in a dire situation,” says Hilton Mbozi, a seed systems and climate change expert.

 

Tauzeni recalls that her community used to receive food supplies such as beans, cooking oil and peanut butter to help combat malnutrition.

 

When Tauzeni got married in 2017, her fields promised abundance. Her harvests were plentiful, and her family never lacked food. Now, those memories feel like whispers from another world. The past two agricultural seasons, those harvests have been devastatingly poor.

 

With an empty granary and dwindling options, Tauzeni’s family survives on the same food every day: baobab porridge in the morning and sadza with wild okra in the evening. But Tauzeniworries whether even this will be on the table in the coming months.

 

“The little maize I have, I got after weeding someone else’s crops, but that won’t take us far,” she says.

 

Tauzeni says a 20-kilogram (44-pound) bag of maize costs US$13 in her village, an amount out of reach for her. Her only source of income is farming. When that fails, she has no money at all.

 

Hunger like Tauzeni experiences is widespread. Some families now eat just once a day.

 

Headman David Musau, leader of Musau village where Tauzenilives, says some people in his village did not plant any seeds this season, fearing losses due to the low rainfall. The government provides food aid inconsistently, usually 7 kilograms (15 pounds) of wheat per person for three months.

 

“It’s not enough, but it helps,” he says.

 

But without any other food aid, survival is at stake, he says. “People will die in the near future.”

 

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Zimbabwe’s new mothers face extortion for ‘free’ child health cards

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Photo credit: Gamuchirai Masiyiwa, GPJ Zimbabwe

BY GAMUCHIRAI MASIYIWA

Summary: The quiet return of maternity fees and the black-market sale of essential documents put extra burdens on mothers as they struggle to navigate a broken system.

First-time mother Connie Jowastands with her 3-month-old baby nestled against her back, chatting with other mothers in line. Like many women at this crowded clinic in Harare’s Mabvuku suburb, Jowa is trying to get a Child Health Card, which was unavailable when she gave birth at a public hospital, and was still out of reach at her local clinic. Health cards are mysteriously out of stock.

 

But they can be bought under the table, if you know who to ask and are willing to pay.

 

Zimbabwe’s Child Health Cards, meant to be free to new mothers, are crucial documents that track babies’ growth, vaccinations and medical histories. Without them, each clinic visit becomes a reset button. Inquiry into the child’s medical history starts from scratch. Since July 2024, the cards have disappeared from health facilities across Harare’s central hospitals and 42 council clinics — even though the card’s producers say they’re making enough to meet demand. This artificial shortage has birthed a shadow market where clinic staff quietly sell this essential document to desperate mothers. This sort of nickel-and-dime bribery exposes deep cracks in a health care system that’s already failing the most vulnerable people.

 

What started as a clandestine operation has become an open secret.

 

“When cards arrive at a clinic, they’re kept by the sister in charge. But it’s usually nurse aides or junior staff who sell them, working in cahoots with other staff members,” says Simbarashe James Tafirenyika, who leads the Zimbabwe Municipality’s Nurses and Allied Workers Union.

 

Someone who sells 100 cards can pocket around US$500, she says, and none of that money goes to the government of the council.

 

The going rate for the Child Health Card is US$5, say several mothers who spoke to Global Press Journal.

 

Medical Histories on Scraps of Paper

 

When the system works as designed, every mother receives a Child Health Card when her baby is born. Now, most mothers must track their infants’ medical histories on scraps of paper.

 

Harare’s council clinics alone deliver more than 3,000 babies every month, with each mother left scrambling for documentation.

 

“I feel hurt,” Jowa says. “I want to know what vaccines my child has received and their purposes, but I just can’t get that information.”

 

A nurse aide assistant at one of the council clinics has witnessed this shadow market.

 

“If a nurse is selling, they ask the mother to be ‘skillful’ if they need the card,” says the assistant, who requested anonymity for fear of retribution. In Zimbabwe, “skillful” is a common euphemism for paying small bribes.

 

While the Ministry of Health and Child Care is supposed to supply the cards for free, Prosper Chonzi, the City of Harare’s director of health, admits supplies have been erratic for six months and that people have complained about being forced to purchase these cards. Clinic workers may be exploiting the known shortage and coordinating among themselves to sell the cards rather than providing them for free, he says.

 

“We can’t rule that out,” he says.

 

The card shortage coincides with the quiet return of maternity fees in public hospitals. Though not officially announced, hospitals have begun billing mothers after delivery — a policy change the government would neither confirm nor deny.

 

High Inflation, More Corruption

 

Between 2011 and 2024, more than 1 million pregnant women in the country delivered babies for free at health care clinics, under a scheme called results-based financing. Maternal mortality rates dropped during that time.

 

But these gains, partly achieved through better access to safe delivery services, face new hurdles as budget constraints and economic pressures reshape the health care landscape.

 

Even in 2021, a study from Transparency International Zimbabwe surveyed over 1,000 people in Zimbabwe and found that 74% had been asked to pay a bribe while trying to access health care services. A feeling of being underpaid amidst a deteriorating economy and high inflation was a key driver among health workers who solicitated bribes, which has been a rising trend, according to the study.

 

“The motivation for earning an extra income is strong especially in countries with a high rate of inflation,” the study states.

 

Zimbabwe’s health care system faces chronic challenges, including an exodus of health workers to other countries, inadequate funding, drug shortages, obsolete infrastructure and more. In 1991, the government introduced user fees across public institutions as part of an economic structural adjustment program. The government abolished the fees in 2011, only to partially reinstate them around 2013.

 

Prudence Hanyani, a community activist in Harare, says the reintroduction of user fees in public hospitals will burden women who already shoulder extra costs, like paying for midwives, so they can get better treatment when giving birth.

 

“Maternal health services should be free,” she says, “because giving birth is a service for the nation that contributes to the country’s population.”

 

Mothers Pay the Price

 

Valerie Shangwa, who gave birth four and a half months ago at a private maternity hospital, still has no card for her daughter.

 

“You know how difficult it is to keep a paper,” she says. “When nurses ask about last month’s weight, you end up guessing, and that distorts the whole record.”

 

Charlton Prickise, technical director at Print Flow, says his company sells Child Health Cards only to government-authorized health facilities and faces no shortages.

 

“The shortages mean health facilities simply aren’t coming to get them,” he says.

 

Though Print Flow hasn’t detected leaks, Prickise recalls finding other versions of this card on the market two years ago, possibly from a nongovernmental organization. Print Flow isn’t the sole supplier of the cards, and they haven’t received any government orders recently.

 

In a written response to Global Press Journal, Donald Mujiri, spokesperson for the Ministry of Health and Child Care, said the shortage of Child Health Cards is due to supply chain inefficiencies and insufficient donor funding. The cards, he says, are procured with government funding and aid from supporting partners such as the United Nations Children’s Fund. Nevertheless, Mujiri says, the ministry needs to strengthen the supply chain management system at all levels and proactively mobilize resources for procuring the cards.

 

Meanwhile, mothers wait — or pay the price. Faith Musinami, 26, delivered her daughter in July 2024. An orderly told her the clinic only had cards for boys, but if she wanted, they could organize one for US$5. Musinami had not budgeted for the cost. She sacrificed the last penny she had.

This story was originally published by Global Press Journal.

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Zimbabwe fights a losing battle against illegal Chinese plastics

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Much of Zimbabwe’s plastic waste isn’t disposed of properly. It has clogged rivers, littered streets, and had been linked to deadly flash floods and animal deaths.

BY LINDA MUJURU

At Mbare marketplace, a major trading hub in Zimbabwe, plastic bags are everywhere. Vendors stack them at the ready for customers, who tote their purchases home and often discard the bags after a single use. Many of these plastic bags are either imported from China or sold by local Chinese companies, and fail to meet Zimbabwe’s standards for plastic packaging.

 

“We know this type of plastic isn’t allowed, but we sell it anyway. It’s cheaper, and there is a huge demand for it in the market,” says Tichaona, a local plastic bag vendor who sources his bags from a Chinese company in Harare. He provided only his first name for fear of arrest.

 

In some cases, plastic bag buyers don’t even know that the bags are thinner than is legal, says one employee at Colour Maximal, a Chinese-owned plastic manufacturing company in Harare, who asked Global Press Journal to protect his identity for fear of losing his job.

 

“We know what the quality should be, but we never produce it,” he says. “Customers are told these plastics meet the 30-micron requirement, but that’s simply not true.”

 

Zimbabwean law bans the production and distribution of plastic packaging thinner than 30 microns (a unit of measurement to describe plastic thickness), except for bread packaging, which must measure at least 25 microns. However, the country faces an influx of inexpensive plastic imports from China, coupled with a rise in Chinese-owned manufacturing firms, which now dominate the plastic industry.

 

Many of these importers and manufacturers exploit weak law enforcement to produce plastics that measure lower than the standard, exacerbating a pollution crisis that’s already critical.

 

“[They] don’t care about quality. Their products are cheaper. People can just walk in and buy in bulk,” says Donald Marumbwe, who has worked in the plastic manufacturing industry for over 30 years.

 

Global Press Journal collected samples from Colour Maximal and independently tested them. All samples were thinner than the required 30 microns. Some bags measured were just 20 microns.

 

Global Press Journal also measured bread bags from Mbare marketplace, which, according to the regulations, should range between 25 to 30 microns. Some of those bags measured as thin as 6 microns.

 

Thin plastic bags, often used just once, can take thousands of years to decompose, turning into harmful microplastics that threaten wildlife and enter the human food chain. Thicker plastic is likely to be reused and recycled, reducing environmental impact.

 

But thin plastic is cheaper to make, says Tatenda Murwira, a manager at Colour Maximal. It’s the reason his employer manufactures this kind of plastic, despite the law. “We’re profit-oriented,” he says. “It’s all about saving materials and keeping prices competitive.”

 

In the end, it’s Zimbabweans who suffer. A significant portion of plastic waste — approximately 18% of the country’s total waste — isn’t disposed of properly. It has clogged rivers, littered streets, and, worse, been linked to deadly flash floods and animal deaths due to ingestion. Since 2010, plastics, both locally produced and imported, have caused the deaths of about 5,000 animals.

 

Amkela Sidange, the environmental education and publicity manager at Zimbabwe’s Environmental Management Agency, says they conduct routine inspections to prevent the manufacturing and distribution of plastic that doesn’t meet requirements. Those caught violating the law face fines that could reach 500 United States dollars.

 

But Murwira, the manager at Colour Maximal, says that while officials from the environment agency have visited the company, which has been operating for more than a decade, they’ve never inspected the factory. “They never check the quality of our products,” he says.

 

Once the packaging gets into the market, it’s hard to trace back to the manufacturer. “[The companies] don’t put their names on the packages because they don’t want it traced back to them,” Marumbwe says.

 

None of the plastic bags Global Press Journal examined at Mbare marketplace had a manufacturer’s name on them.

 

Although South Africa is the main supplier of materials used to produce most of the plastic packaging circulating in the country, these imports are on the decline while imports from China are on the rise. In 2012, Zimbabwe imported 10.9 million dollars’ worth of plastic raw materials from China. By 2023, that number had increased fivefold to 54.8 million dollars, according to data from Trade Economics.

 

“We’re profit-oriented. It’s all about saving materials and keeping prices competitive.”

 

Tatenda Murwira, a manager at Colour Maximal

 

China is also a major player in Zimbabwe’s manufacturing sector, largely thanks to former President Robert Mugabe’s push to strengthen ties with East Asian countries. Mugabe famously described China as “our second home, a part of us” in 2006. By 2015, China was Zimbabwe’s biggest foreign investor, and its hold over key sectors, including mining and manufacturing, has grown.

 

The investment has promoted growth, but it’s also come with challenges, including environmental degradation.

 

Chinese-owned companies’ disregard for regulation is indicative of a larger problem, says Gift Mugano, a professor of economics at the Durban University of Technology, in South Africa.

 

“They are in bed with the politicians. [The] Chinese work with people in high offices, so they’re kind of covered, and they don’t respect the environmental laws,” Mugano says.

 

It’s a widespread problem in Africa, where dependency on such investors is common, he says. In Zimbabwe, the situation is even worse because the country is mired in debt, which makes it susceptible to influence from one of its primary investors.

 

“[It’s] a new wave of neo-colonialism,” Mugano adds.

 

Zimbabwe has made several attempts to address its plastic problem, including a 20% tax on plastic bags, which went into effect in January. But companies routinely dodge that tax, just as they’ve avoided the plastic bag regulations, says the ColourMaximal employee who spoke on condition of anonymity.

 

“At the end of 2024, Zimbabwe Revenue Authority representatives visited our offices, threatening to shut us down for nonpayment of taxes,” he says.

 

Murwira, the manager, says Colour Maximal is fully tax compliant.

 

Global Press Journal visited a plastic-packaging production company formally registered as Liwei Wang but currently trading as Multiple Star. Upon inquiry, factory representatives said that their plastic bags measured only 20 microns, short of the standard.

 

On display at the site was an expired 2024 tax clearance certificate.

 

Global Press is an award-winning international news publication with more than 40 independent newsrooms in Africa, Asia and Latin America.

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