Moffat Mungazi
Lloyd Makonya
Correspondent
THE Zimbabwean export sector, a critical pillar for generating of foreign currency and sustaining the country’s economic stability, claim to be slowly suffocating from the Reserve Bank of Zimbabwe’s (RBZ)’s decision to increase the foreign currency surrender requirement from 25 percent to 30 percent.
The measure, announced earlier this year in the 2025 Monetary Policy Statement (MPS) by RBZ Governor, D. John Mushayavanhu, has stirred mixed feelings among exporters who argue that the policy renders their businesses uncompetitive and undercuts the hard-earned gains of recent export-led growth.
Presenting the Monetary Policy statement under the theme: “Fostering Prices, Currency and Exchange Rate Stability through Balancing Confidence, Trust, Credibility, Efficiency, Stability and Growth,” Dr Mushayavanhu outlined several strategies aimed at reinforcing the newly introduced Zimbabwe Gold (ZiG) currency.
Central to these strategies is the reduction of foreign currency retention levels for exporters from 75 percent to 70 percent, effectively increasing the surrender portion of proceeds from 25 percent to 30 percent.
This adjustment, the Central Bank argued, is necessary to augment foreign currency supply on the formal market, build critical reserves, and support the wider usage of ZiG.
According to RBZ, the overarching objective is for the ZiG to become the sole transaction currency by 2030, underpinned by improved market confidence and monetary discipline.
However, the policy has pushed exporters such as Proplastics, a key player in Zimbabwe’s manufacturing export sector to express concern, when they recently stated in their first quarter report that the increase in the surrender requirement has severely compromised its export competitiveness.
“The increase in the foreign currency surrender requirement from 25 percent to 30 percent for exports has, not only eroded the competitiveness of our exports, but also negatively impacted overall market positioning and exporting viability,” the firm said.
The company argues that the surrender of 30 percent of export earnings, especially under an environment of multiple exchange rates and rising input costs, undermines profitability and hampers the ability of exporters to reinvest or sustain operations.
Exporters typically rely on retained hard currency to finance the importation of raw materials, pay offshore service providers, and hedge against the volatility of local currency.
A reduction in these reserves often forces companies to turn to the parallel market for foreign currency, where rates are unfavourable and volatile.
Further adding to the debate, Tanganda Tea Company finance director, Mr Henry Nemaire expressed concern over the policy in a shared social media comment on LinkedIn.
He argued that value is being taken from the very sectors that generate hard currency likening exporters to “geese laying the golden eggs” and redistributed to importers in a manner that distorts economic incentives.
According to Mr Nemaire, the current surrender policy, especially in the context of multiple exchange rates, discourages exports and inadvertently encourages imports, a scenario that undermines Zimbabwe’s aspirations for a balanced and sustainable economic model.
He contended that: “Fiscal planning should achieve collection of revenue, redistribution of income and encouragement and discouragement of certain behaviours. This policy does not generate revenue for the Treasury, does not redistribute income to the less privileged and encourages what must be discouraged and discourages what must be encouraged.”
Interestingly, this comes at a time when Zimbabwe’s export figures appear to be on an upward trajectory.
Data from the Zimbabwe National Statistics Agency (ZimStat) indicates that total exports rose to US$7,43 billion in 2024, up from US$7,2 billion in 2023.
The country’s top export product remains semi-manufactured gold, followed by other commodities such as tobacco, platinum, and tea. While these numbers suggest positive momentum, they may mask underlying vulnerabilities.
Much of the export growth may be concentrated in a few commodity-based sectors, raising concerns about sustainability and the resilience of value-added exports under the current policy environment.
The central discussion which must be at the heart of this debate lies in reconciling short-term monetary goals with long-term economic competitiveness.
The RBZ’s move to increase surrender requirements is clearly aimed at stabilising the foreign exchange market and building confidence in the ZiG.
Yet, the unintended consequence may be to suffocate the very export sectors expected to fuel that stability.
Exporters find themselves caught between patriotic duty and economic survival as they comply with policies that may weaken their global competitiveness.
Achieving a meaningful balance will require greater engagement between government and industry stakeholders, transparency in policy formulation, and responsiveness to the real challenges facing exporters.
It will also demand a rethinking of how incentives are structured in Zimbabwe’s economy.
If the country is to meet its 2030 target of making the ZiG the sole transaction currency, it must ensure that the backbone of its foreign currency generation which is the export sector is not broken in the process.
The challenge, therefore, is not whether to pursue stability, but how to do so without sacrificing growth, trust, and competitiveness along the way.
Online Reporter