Policy Volatility as A Barrier to Industrial Renewal: Regulatory Instability and Its Impact on Long-Term Investment in Zimbabwe's Manufacturing Sector

Angeline Mutarisi; Desderio. M. Chavunduka; Nelia. E. Marima

doi:10.63726/jmsit.v2i2.608

Authors

Angeline Mutarisi Chinhoyi University of Technology
Desderio. M. Chavunduka Chinhoyi University of Technology
Nelia. E. Marima Chinhoyi University of Technology

DOI:

https://doi.org/10.63726/jmsit.v2i2.608

Keywords:

Policy instability, Regulatory uncertainty, Zimbabwe Industrial Polciy

Abstract

Regulatory and policy instability has emerged as a critical systemic barrier to manufacturing sector revitalization in Zimbabwe, creating an environment where long-term strategic planning and capital investment become difficult for industrial firms. This article examines how frequent and unpredictable changes in economic policies, currency regimes, tax laws and regulatory frameworks fundamentally undermine industrial innovation and growth. Grounded in a mixed-methods doctoral study that surveyed 175 respondents and conducted in-depth interviews with 30 participants across Zimbabwe's mining and chemical manufacturing sub-sectors in Harare, Mutare, Bulawayo, and Hwange, the research reveals that regulatory instability operates as a profound disincentive to the multi-year investment commitments that innovation demands. The research establishes that regulatory uncertainty creates a stagnation mentality, with firms perpetually postponing innovation investments in hopes of future policy stability, effectively trapping the sector in a state of strategic paralysis. This article demonstrates that while individual firms can develop strategies to navigate policy volatility through diversified operations, strong government relations or business models resilient to regulatory change, such adaptations cannot substitute for the fundamental requirement of a stable, predictable, and transparent policy framework. The study concludes that without deliberate policy coherence, consistency, and predictability, including stable currency regimes, transparent tax policies and reliable regulatory enforcement, Zimbabwe's manufacturing sector cannot attract the long-term capital investment essential for technological upgrading, product diversification and global competitiveness. The findings carry urgent implications for policymakers, underscoring that industrial policy stability is not merely an enabling condition but an absolute prerequisite for industrial innovation and growth.

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