By Newton M. Mambande
INTRODUCTION: INVESTMENT IN AN AGE OF POLYCRISIS
HARARE – THE United Nations Conference on Trade and Development’s World Investment Report 2026 arrives at a moment when the global economy can only be described as polycrisis. Currency volatility, tariff wars, climate shocks, pandemic scarring, and a retreat from multilateralism have redefined the geography of capital.
For Zimbabwe, the Report’s release is not an academic exercise. It is a mirror. Between 2021 and 2025, we lived through every theme the Report identifies, often in exaggerated form. We endured currency instability, abrupt policy reversals, the US-China trade decoupling, COVID-19, and successive climate shocks of drought, famine, and cyclones. We also contended with a persistent challenge: corruption and weak governance that erodes investor confidence.
Using the analytical framework of economic history and development economics, this column argues that Zimbabwe’s investment performance from 2021-2025 was not determined by a lack of opportunity. It was determined by the interaction between external shocks and domestic institutional failures. Until we address the domestic fractures, global headwinds alone will not bring the capital we need.
1. THE GLOBAL CONTEXT: WHAT THE WORLD INVESTMENT REPORT 2026 TELLS US
The WIR 2026 makes three central observations relevant to frontier markets like Zimbabwe.
First: The Fragmentation of Capital. US-China strategic competition and tariff escalation have forced multinational firms to “friend-shore” and “near-shore.” Investment flows are increasingly political. Capital no longer seeks only the lowest cost; it seeks the lowest risk within an allied bloc.
Second: The Premium on Resilience. Post-COVID-19, investors now price climate risk, health system resilience, and supply chain redundancy into every project. Drought, floods, and cyclones are no longer “acts of God” on a spreadsheet. They are line items.
Third: The Currency Factor. In an era of a strong US Dollar and volatile emerging market currencies, investors demand either hard currency revenues or credible local currency stability. Without it, foreign direct investment dries up.
Zimbabwe from 2021 to 2025 experienced all three dynamics simultaneously. The question is: did we respond with institutions that attract capital, or with policies that repel it?
2. CURRENCY INSTABILITY: THE ORIGINAL SIN OF ZIMBABWEAN INVESTMENT
No discussion of Zimbabwe and investment can begin anywhere except with money.
Between 2021 and 2025, Zimbabwe cycled through at least three distinct currency regimes: the multi-currency system, the Zimbabwe Dollar reintroduction and managed float, and renewed de facto dollarisation. Each transition was accompanied by premium gaps, arrears, and a collapse in savings.
From a development economics perspective, currency instability is a tax on investment. It creates what economists call irreversibility risk. A factory, a dam, or a mine cannot be moved once built. If an investor cannot be certain of the unit of account in which they will be repaid, they will not invest.
The evidence is in the balance of payments. While global FDI to Africa recovered post-COVID, Zimbabwe’s inflows remained concentrated in extractives and portfolio flows that can exit quickly. Greenfield manufacturing and agro-processing FDI was minimal. Why? Because investors could not model returns in a currency that lost 50% of its value in a quarter.
The WIR 2026 is clear: currency convertibility and predictability are now a first-order condition for investment, not a second-order reform. Zimbabwe’s policy reversals on currency between 2021-2025 violated that condition repeatedly.
3. POLICY REVERSALS AND INCONSISTENCIES: THE COST OF UNCERTAINTY
Economic history teaches us that investors do not fear high taxes. They fear unpredictable taxes. They do not fear regulation. They fear unpredictable regulation.
Between 2021 and 2025, Zimbabwe’s policy environment was characterised by what Douglass North called “institutional volatility.” Examples abound: indigenisation requirements revised, then suspended, then reintroduced in sectoral form. Statutory Instrument 142 of 2019 banning foreign currency, then partial liberalisation, then re-tightening. Export surrender requirements moved from 40% to 25% and back.
This is the economics of time inconsistency. Government announces a policy to attract investment, but once investment is sunk, it changes the rules post-investment, creating a perception of policy instability. Rational investors anticipate this and stay away.
The result was a crowding-out of long-term capital by short-term traders. Money flowed into arbitrage, forex trading, and parallel market activities, not into productive capacity. The WIR 2026 notes that global investors are allocating to jurisdictions with “policy durability.” From 2021-2025, Zimbabwe signalled the opposite.
4. TRADE, TARIFFS, AND THE US-CHINA DECOUPLING
The US-China trade war did not end in 2020. It evolved. By 2023-2025, it had become a structural feature: tariffs, export controls on technology, and the Inflation Reduction Act on one side, and China’s Belt and Road recalibration on the other.
For Zimbabwe, this presented both risk and opportunity.
The Risk: As a small, open economy, we are a price taker. When the US imposes tariffs on Chinese goods, Chinese firms dump excess capacity in Africa. That depressed prices for our steel, ceramics, and textiles. When China slows, demand for our minerals softens.
The Opportunity: “Friend-shoring.” The US and EU are looking for critical minerals outside China. Zimbabwe has lithium, platinum, and chrome. The WIR 2026 identifies critical minerals as the fastest growing FDI segment globally.
Did we capture it? Partially. Lithium investments surged from 2021-2023. But much of it was in raw ore export, not beneficiation. The reason returns to policy. Investors cited inconsistent royalties, power shortages, and uncertainty over indigenisation in value-addition plants. We exported geology, not industry.
Meanwhile, US AGOA preferences remained, but non-tariff barriers and compliance costs kept Zimbabwean agro-exports marginal. The lesson: trade policy is not just about tariffs. It is about standards, logistics, and credibility. We lacked all three in sufficient measure.
5. CORRUPTION: THE TRANSACTION COST THAT KILLS PROJECTS
The WIR 2026 does not use the word “corruption” often. It uses “governance risk premium.” It is the same thing.
From 2021-2025, Zimbabwe’s Corruption Perceptions Index remained in the bottom quartile globally. For an investor, this translates directly into cost. It is the cost of licences that take 18 months. It is the cost of “facilitation.” It is the cost of a court system that cannot enforce a contract in under 3 years.
Development economists call this a “deadweight loss.” Resources that should go to plant and machinery go to transaction costs. Worse, it creates adverse selection. The investors who are willing to pay the governance premium are often not the ones with the best technology. They are the ones with the highest risk appetite.
This is why Zimbabwe attracted speculative mining deals but struggled to attract blue-chip manufacturing firms. Reputable multinational corporations have strict compliance departments and cannot operate in environments where the governance risk premium is high. Until we reduce this premium, we will remain a high-cost destination despite low wages.
6. COVID-19: THE SCAR THAT DID NOT HEAL
COVID-19 hit Zimbabwe in 2020, but its investment scars ran through 2025.
First, it destroyed balance sheets. SMEs that constitute 60% of employment lost working capital and never recovered. Banks became risk averse.
Second, it exposed the fragility of our health system. The WIR 2026 now includes a “health resilience index” for investors. Firms ask: if there is another pandemic, can my workers be vaccinated? Can my supply chain function? For many investors, Zimbabwe’s answer during 2021-2022 raised significant concerns.
Third, it accelerated informality. As formal jobs disappeared, more economic activity moved off the books. That shrank the tax base and made formal investment less attractive.
The recovery was K-shaped. Mining and telecoms recovered quickly. Manufacturing, tourism, and agriculture did not. Investment followed the recovery.
7. CLIMATE CHANGE: DROUGHT, FAMINE, AND CYCLONES AS ECONOMIC SHOCKS
If currency was the domestic fracture, climate was the external hammer.
From 2021 to 2025, Zimbabwe experienced:
- 2022 Cyclone Ana and 2023 Cyclone Freddy: Infrastructure damage, disruption to the Beira corridor, and loss of agricultural output in Manicaland.
- 2023-2024 El Niño drought: Maize production fell by over 60%. The government declared a state of disaster. 7.6 million people required food aid.
- 2025 floods: Further displacement and damage to roads and irrigation.
In economic history, climate shocks are not new. What is new is their frequency and their impact on investment calculus.
The WIR 2026 now requires climate risk disclosure. An investor building a food processing plant asks: will there be maize in 3 years? Will the road to Beira be open? Will insurance be available?
Zimbabwe’s response was largely humanitarian, not structural. We did not invest enough in irrigation, climate-smart agriculture, or resilient infrastructure. As a result, agriculture, which should be our FDI magnet, became our risk. Capital fled to mining, which is less rainfall dependent.
8. THE ECONOMIC HISTORY LENS: WHY WE REPEAT THE CYCLE
Economic history offers two lessons for Zimbabwe 2021-2025.
Lesson One: The Resource Curse Revisited. Countries rich in resources but poor in institutions attract enclave investment. The mine comes, the money leaves, and little is transformed locally. That describes much of our lithium and gold boom.
Lesson Two: The Importance of Policy Credibility. Post-war Germany and Japan did not grow because they had resources. They grew because investors believed policy would not change overnight. Botswana grew because it managed diamonds with a stable fiscal rule.
Zimbabwe between 2021-2025 had the resources. We lacked the credibility.
9. THE PATH FORWARD: 5 REFORMS TO ALIGN WITH WIR 2026
If the WIR 2026 is a diagnosis, what is the prescription for Zimbabwe?
1. Currency and Fiscal Anchors: Adopt a clear, rules-based monetary framework. Stop financing deficits with monetary expansion. Investors need to know the rules of money.
2. Policy Durability Act: Parliament should legislate a 5-year moratorium on changes to investment, tax, and indigenisation policy without a 12-month notice period. Signal that the rules will not change mid-game.
3. Governance Reform: Digitise licensing. Publish all mining and procurement contracts. Empower the Zimbabwe Anti-Corruption Commission with prosecutorial independence. Reduce the governance risk premium.
4. Climate-Proof Investment: Use FDI to build irrigation, renewable energy, and climate-resilient roads. Market Zimbabwe not just as a minerals destination, but as a climate-resilient agro-industrial hub.
5. Strategic Positioning in US-China Rivalry: Do not choose sides. Become indispensable to both. Export beneficiated lithium to the US and EU. Export agro-products to China. Use Special Economic Zones with clear rules to attract “friend-shored” manufacturing.
CONCLUSION: INVESTMENT IS A VOTE OF CONFIDENCE
The World Investment Report 2026 tells us that global capital is scarce, selective, and risk-averse. It is looking for places where money is stable, policy is predictable, and the future is not being eroded by climate or corruption.
From 2021 to 2025, Zimbabwe offered the world resources, people, and potential. But we also offered currency swings, policy whiplash, and climate vulnerability.
Investment is not charity. It is a vote of confidence. To win that vote, we must do the hard work of institutional reform. The geology will not change. The weather will get worse. The only variable we control is governance.
As economic history shows, nations do not grow because they are rich. They become rich because they grow. And they grow when capital believes in tomorrow.
The WIR 2026 is an invitation. Will Zimbabwe answer it?
Newton M. Mambande is an entrepreneur and researcher with published scientific research scholarship in journals. He can be reached at newtonmunod@gmail.com or +263 773 411 103
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