Harare – Foreign owned businesses operating in several everyday sectors in Zimbabwe have been ordered to surrender majority ownership to local citizens within three years under a new law that reshapes the country’s economic participation rules.
The regulations are contained in Statutory Instrument 215 of 2025, which came into effect on 12 December 2025. The law requires existing foreign run enterprises in designated reserved sectors to divest 75 percent of their shareholding to Zimbabwean citizens by December 2028 or cease operations and leave the country.
Under the new framework, foreigners are no longer allowed to operate in seventeen economic sectors and sub sectors that are now strictly reserved for locals. The policy targets small and medium enterprises that form part of daily economic life, a move authorities say is meant to create space for indigenous entrepreneurs.
Businesses affected by the compulsory divestment include barber shops, hairdressing and beauty salons, bakeries, employment agencies, estate agencies, advertising agencies, valet services, pharmaceutical retail outlets, tobacco grading and packaging operations, borehole drilling services, passenger bus services, taxis, car hire firms, artisanal mining activities and the marketing and distribution of local arts and crafts.
The transport sector, clearing and customs services and estate agency operations are also restricted to Zimbabwean citizens, with limited exceptions for international brands operating under special arrangements.
Foreign owned businesses already operating in these sectors are expected to sell 25 percent of their shares each year over the next three years to reach the 75 percent local ownership threshold. Failure to comply will result in closure or exit from the Zimbabwean market.
There are, however, high entry thresholds for foreign investors seeking to operate in certain sectors that are partially open. In retail and wholesale trade, foreign participation is allowed only for investors committing at least 20 million United States dollars and employing a minimum of 200 workers. In the haulage and trucking industry, the requirement is an investment of at least 10 million United States dollars with 100 employees.
Grain milling operations open to foreign participation require an investment of 25 million United States dollars and at least 50 employees, while shipping and forwarding businesses demand a minimum of 1 million United States dollars and a workforce of 20 people.
Large scale sectors such as banking and major mining operations are not affected by the new restrictions and remain open to foreign ownership under existing laws.
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