Bulawayo leads as formal business hub

Nqobile Bhebhe, Zimpapers Business HubBULAWAYO has emerged as the country’s leading province for formal business establishments, with new official statistics revealing the city significantly outpaces the national average and all other provinces in formalisation.Preliminary findings from the 2023 Economic Census by the Zimbabwe National Statistics Agency (ZimStat) show that 40,4 percent of Bulawayo’s 15 840 businesses are formal — the highest rate in the country. Conversely, the city has the lowest percentage of informal businesses, at 59,6 percent. This is in sharp contrast to the national average, where only 23,9 percent of the 204 798 total establishments are formal, while 76,1 percent are informal.This data highlights Bulawayo’s economic transformation and its strong culture of regulatory compliance.

The city is being positioned as a model for the Government’s formalisation and ease-of-doing-business agenda under its devolution policy. Economic commentators attribute this positive trend to Bulawayo’s industrial legacy and the targeted efforts by both central and local Government to promote investment, business registration and regularisation.“This is a very strong signal that Bulawayo is responding to formalisation drives and institutional support. With over 40 percent formal businesses, the city can better attract structured investment, ensure decent jobs and contribute to the tax base,” said economist Ms Alice Chikonzi.She also highlighted Bulawayo’s strategic role in national economic growth, noting its geographic, industrial and logistical advantages.

“Bulawayo sits at the heart of regional trade corridors linking Zimbabwe to South Africa, Botswana and Namibia. “It has a legacy industrial base, existing infrastructure and a skilled labour pool. With the right investment and policy support, the city can drive manufacturing growth, boost exports and anchor the country’s re-industrialisation agenda,” she added.Benefits for traders and local authoritiesVendors operating within formalised trading spaces also noted the benefits of compliance.

Mrs Prisca Ncube praised the formalisation drive, stating, “Being a formal trader gives me peace of mind. I no longer worry about running from municipal police and now I can apply for small business loans and stock my stall properly. I even get receipts for rent, which helps when I need to prove my business income.

We feel recognised now. Formalisation is not just about rules, it’s about building our businesses and planning for the future.”Analysts say increased formalisation expands the tax base for both the Government and local authorities, improving the public revenue streams needed for infrastructure development, service delivery and social protection programmes.“A higher number of registered businesses means more reliable tax collection for authorities, which in turn funds local amenities such as markets, roads, waste management and utilities. It’s a win-win for both traders and municipalities,” said economic development expert Allan Mthunzi.

He also noted that formalisation is essential for unlocking Zimbabwe’s full economic potential. “We cannot grow a modern, resilient economy on the back of informality. Formal businesses contribute to GDP, pay taxes, create secure jobs and are easier to monitor and support.

Formalisation provides the structure needed for long-term planning and sustainable development,” he said.By contrast, Mashonaland Central (13,9 percent), Mashonaland East (17,8 percent), Midlands (18,8 percent) and Matabeleland South (20,5 percent) recorded the lowest levels of formalisation, with more than 75 percent of businesses operating informally in each province. Even Harare, which has the largest number of establishments at 83 267, had only 23,8 percent formal businesses — just below the national average.The findings underscore the growing importance of Bulawayo in Zimbabwe’s economic reform drive and present opportunities for more focused policy interventions. Formal businesses, analysts note, are better positioned to access credit, markets and Government support facilities, which enhances their potential to create jobs and improve livelihoods.

The findings align with national development objectives under Vision 2030 and National Development Strategy 1 (NDS1), which aim to formalise and grow the economy through inclusive, sustainable industrialisation.Meanwhile, Bulawayo, Matabeleland North and Matabeleland South provinces show mixed performance in capacity utilisation across the mining, quarrying and manufacturing sectors.According to ZimStat, Bulawayo had a strong performance in mining and quarrying, with a capacity utilisation rate of 56,6 percent, placing it fourth nationally. However, the city struggled in manufacturing, with a rate of only 42,8 percent — the third lowest in the country. This highlights lingering challenges such as outdated equipment, inadequate retooling and limited new investment in the once-thriving industrial hub.In Matabeleland North, mining and quarrying capacity utilisation was at a national low of 44,7 percent, despite the province being rich in untapped resources such as coal, methane gas and gold.

However, in manufacturing, the province posted a modest 46,9 percent, slightly above the national average, indicating emerging industrial activity.Matabeleland South fared relatively better in both sectors, recording 48,9 percent utilisation in mining and quarrying and 47,0 percent in manufacturing, placing it fourth nationally in the latter. These figures point to growing SME participation and increased Government support for local industrialisation through the devolution programme.Nationally, capacity utilisation in mining and quarrying ranged from 44,7 percent in Matabeleland North to 68,1 percent in Masvingo, while manufacturing utilisation ranged from 40,9 percent in Midlands to 51,9 percent in Manicaland.The Government has consistently emphasised the need to improve productive capacity across all provinces as part of NDS1, with the ultimate goal of re-industrialisation, value chain development and equitable regional growth. With Bulawayo and the wider Matabeleland region forming critical corridors for regional trade, logistics and mineral beneficiation, authorities say there is an urgent need to accelerate infrastructure development, energy provision and value chain financing to unlock the full industrial potential of the region.Share on FacebookPost on XFollow usSave

Originally published on Zimbabwe Herald

Source: Zimbabwe Herald

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