President Mugabe has vowed to act against rising corruption at a time of economic crisis in the country. Political analysts say the move may be an attempt to boost the popularity of his ruling Zanu-PF party, ahead of parliamentary elections next year.
Two senior Zanu-PF officials have recently been arrested on corruption charges.
The ministry will also be in charge of an anti-monopoly programme.
Mr Mugabe also appointed Zanu-PF governors to the provinces of Harare and Bulawayo, both opposition strongholds. When this was announced last year, the opposition MDC said it was an attempt to take power away from its local councillors and MPs.
In other changes:
l John Nkomo takes responsibility for land reform from Joseph Made, who remains agriculture minister;
l Finance Minister Herbert Murewa is replaced by his deputy Chris Kuruneri;
l Retired air force chief air marshal Josiah Tungamirai, who won a by-election last week, becomes minister of indigenisation and empowerment.
This is the first reshuffle since August 2002, following President Mugabe’s re-election in disputed polls.
Meanwhile, Zimbabwe’s media commission says it will not allow journalists employed by the only privately-owned daily newspaper, the Daily News, to work until their paper has been registered.
Journalists working for the paper had applied for accreditation, but the media commission has ruled that their paper must be registered before their applications can be credited.
The closure of the Daily News was criticised by Southern African and international human rights groups.
