IMF Completes First Review of Zimbabwe — FSX Business
The International Monetary Fund (IMF) has completed the first review of Zimbabwe’s 10-month Staff-Monitored Program (SMP), marking progress in the country’s efforts to strengthen economic stability, clear arrears, restructure debt and rebuild ties with international partners. The IMF said Zimbabwe’s programme implementation remained strong, with all quantitative targets for the end of March met, including those related to the primary budget balance, net international reserves, central bank financing to the non-financial public sector, external borrowing and monetary base growth.
The review comes as Zimbabwe’s economy continues to recover despite a more challenging global environment. Economic growth reached 8.3 percent in 2025, supported by stronger agricultural output, increased mining activity and higher gold prices, according to the IMF. Growth is projected to slow to 5 percent in 2026 and 4.2 percent over the medium term as the effects of last year’s strong expansion moderate. Inflation is expected to remain in single digits, supported by tight monetary policy and relative exchange-rate stability.
The IMF said risks to the outlook remain tilted to the downside, citing the possibility of a major El Niño weather event and renewed conflict in the Middle East as potential external shocks. Fiscal performance under the programme has exceeded expectations, with the primary budget balance through March stronger than anticipated due to higher revenue collection. The IMF said authorities remain committed to keeping spending within the approved 2026 national budget while saving additional revenues to build buffers for potential food-security needs in 2027.
The programme also supports measures to reduce fiscal risks, including reforms to gold delivery incentives, rules governing early debt repayments and stronger safeguards for clearing domestic arrears. The Reserve Bank of Zimbabwe has maintained a tight monetary policy stance to contain inflation and ease pressure on the foreign exchange market. The IMF welcomed the introduction of a ZiG-denominated term deposit facility, describing it as part of a gradual move towards more market-based monetary instruments.
The fund said Zimbabwe would benefit over time from reducing reliance on non-negotiable certificates of deposit, which would help improve monetary policy transmission and support development of domestic money markets. Structural reforms remain central to the programme, with the IMF highlighting the need for improvements in public financial management, governance, fiscal risk management and social protection systems. The missed target on protected social and priority spending during the review period highlighted challenges in ensuring timely support for vulnerable groups. Zimbabwe launched the Staff-Monitored Program as part of efforts to demonstrate policy credibility and advance its broader re-engagement agenda with international creditors and development partners. The IMF said continued progress under the programme, alongside efforts to reconcile debt data and develop an arrears-clearance and debt-resolution strategy, would support the next stages of the country’s return to international financial engagement.
Source: FSX Business News
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