The Zimbabwe National Chamber of Commerce (ZNCC) says the success of the proposed 24-hour economy hinges on supportive policies, particularly a depreciation framework that recognises the accelerated wear and tear of capital equipment under extended operating hours.Zimbabwean cultural products
In its latest analysis, the chamber said that depreciation policy serves as a decisive investment signal in a multi-shift production environment, as accelerated depreciation provisions lower the effective cost of new capital and influence firm-level investment decisions.
ZNCC said the proposal in Zimbabwe’s 2026 National Budget to incentivise a 24-hour economy represents a notable shift in economic thinking.
“Zimbabwe’s 2026 National Budget Statement proposal to incentivise a 24-hour economy represents a notable shift in development strategy, reframing growth, not as a function of expanded capital stock but as a function of more intensive capital use.
Zimbabwe National Chamber of Commerce
“Properly understood, a 24-hour economy is not about extending working hours per se; it is a structural intervention that affects investment incentives, capacity utilisation, depreciation dynamics, energy provisioning, labour productivity and the cost of capital,” ZNCC noted.
The chamber noted that the economic rationale for a 24-hour economy is to improve productivity through higher capital utilisation rather than increased labour intensity.
“Whether this potential is realised depends critically on complementary policies relating to depreciation, energy security and finance.”
ZNCC said single-shift operations in capital-intensive sectors such as manufacturing, logistics, and agro-processing often result in high-fixed costs because machinery depreciates regardless of utilisation.
“Single-shift operation in capital-intensive sectors such as manufacturing, logistics and agro-processing results in high average fixed costs, as plant and equipment depreciate irrespective of utilisation.
“Extending operations across multiple shifts increases output without proportional new investment, raising returns on assets and improving cost competitiveness.
Minister of Finance, Economic Development and Investment Promotion, Professor Mthuli Ncube.“At the macro level, higher utilisation supports output growth, employment absorption, and export performance.”
However, the chamber warned that extended operations inevitably accelerate physical wear of equipment, making an adaptive depreciation framework critical.
“A central implication of extended operations is accelerated physical wear of capital equipment.
“In this context, depreciation policy becomes a decisive investment signal, because accelerated depreciation provisions improve the effective cost of new capital and influence firm-level investment timing.”
ZNCC said this was particularly important for Zimbabwean firms that face high borrowing costs.
“For Zimbabwean firms facing high borrowing costs, accelerated depreciation functions as an indirect investment incentive by strengthening internal financing capacity and reducing dependence on external credit.Zimbabwean cultural products
“Depreciation schedules calibrated for single-shift use understated capital consumption in a 24-hour operating environment, thereby discouraging productivity-enhancing investment.
“Without reform, firms face faster capital exhaustion without compensating tax relief, weakening incentives to extend operations.”
The chamber also emphasised that a reliable energy supply remains a fundamental requirement for a sustainable 24-hour economy.
“Reliable energy supply is a prerequisite for any 24-hour economy. Zimbabwe’s recent experience indicates that grid unreliability is a persistent structural constraint. Energy shortages remain a key factor suppressing capacity utilisation and competitiveness.”
It noted that many firms are increasingly investing in alternative energy solutions to cushion themselves from power disruptions.
“Consequently, firms are increasingly investing in captive energy solutions, including solar generation, battery storage and hybrid systems.
“Evidence from sub-Saharan Africa shows that power outages reduce firm sales and productivity, making self-generation economically rational when grid reliability falls below critical thresholds.
“In the short to medium-term, Zimbabwe’s 24-hour economy is therefore likely to be firm-led rather than grid-led.”
ZNCC added that policy effectiveness will depend on enabling frameworks for embedded generation, grid wheeling and regulatory certainty.
“Policy relevance lies less in generation targets than in enabling frameworks for embedded generation, grid wheeling, and regulatory certainty.
“For firms, energy infrastructure has become strategic capital expenditure rather than a peripheral cost.”
The chamber further observed that a 24-hour economy is productivity-intensive and requires careful management of labour systems.
“A 24-hour economy is productivity-intensive rather than labour-intensive. Multi-shift systems perform best where processes are standardised, mechanised, and supported by skills development and occupational health safeguards.
“Poorly designed shift systems increase fatigue and error rates, eroding productivity gains.”
ZNCC said Zimbabwe’s ambition to implement a 24-hour economy is economically sound, but warned that its success will depend on disciplined implementation.Zimbabwean cultural products
“Zimbabwe’s ambition to promote a 24-hour economy is economically coherent, but its effectiveness will depend on implementation discipline rather than policy rhetoric.
“Persistently low-capacity utilisation, structurally constrained energy reliability, and elevated financing costs continue to shape firm behaviour and investment decisions.
“Within this context, extended operations are viable only where firms pursue deliberate, productivity-driven strategies that raise capital utilisation rather than simply extend operating hours.”
The chamber said aligning policy frameworks with firm-level incentives will be essential.
“Achieving such outcomes requires close alignment between policy framework and firm-level incentives. Coherent depreciation regimes that reflect intensive capital use, reliable firm-led energy solutions, prudent capital allocation, and robust labour productivity systems are essential enablers of sustained multi-shift operations.”
In the 2026 National Budget Statement, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube acknowledged that the current tax framework does not provide specific incentives for firms that operate extended production cycles.
He said limited operating hours in key sectors such as manufacturing continue to constrain industrial output and economic growth.
“Energy and security concerns are a key barrier to adopting 24- hour operations. Without fiscal support, extended operating 290 hours may not be economically viable, particularly in energy-intensive sectors.
“The resulting under-utilisation of existing capital infrastructure, including factories, limits productivity and increases unit production costs.”
Prof Ncube said the Government intends to introduce targeted tax incentives to support firms willing to extend production hours.
He said the incentives will be directed at manufacturers able to demonstrate increased output and revenue generation.
Prof Ncube noted that to support the transition towards a 24-hour productive economy, he proposed to introduce targeted tax incentives for firms operating extended production or service hours in the manufacturing sector, where operators demonstrate incremental production and revenue.-herald
