Zimbabwe limits gold-buying incentives to $300 million as it weighs the cost of backing its currency

Zimbabwe will cap government spending on its gold-buying incentive scheme at $300 million this year and review the program as part of the 2027 national budget, according to a letter from the country’s top economic officials to the International Monetary Fund.

Finance Minister Mthuli Ncube and Central Bank Governor John Mushayavanhu said the spending limit is intended to reduce fiscal risks linked to fluctuations in gold prices and deliveries. The government will cap total spending on the scheme through the end of 2026 at $300 million, Bloomberg reported.

Zimbabwe will also assess whether the gold incentive program remains financially sustainable and whether its scope should be adjusted as it prepares the 2027 budget.

The government has used the scheme to support gold purchases, helping underpin confidence in the Zig, or Zimbabwe Gold, the gold-backed currency introduced in 2024. The policy is part of broader efforts to stabilise the currency and restore confidence in Zimbabwe’s financial system.

The spending review comes as Zimbabwe works to rebuild its relationship with international lenders. After years of negotiations with the IMF, the country secured a 10-month staff-monitored program in February, a key step toward addressing billions of dollars in outstanding debt.

Zimbabwe has been excluded from international capital markets since 1999, when it defaulted on debts owed to institutions including the World Bank, the Paris Club and the African Development Bank.

The IMF expects Zimbabwe’s economy to grow by 5% this year and 4.2% in 2027. The country is scheduled to present its 2027 national budget in November.

Gold production has also continued to strengthen. Zimbabwe produced 21.4 metric tons of gold in the first half of 2026, up from 20.3 metric tons during the same period last year. Gold export earnings surged 69% to $3.1 billion during the period, according to central bank data.

The government’s decision to cap spending therefore comes as Zimbabwe’s gold sector is expanding, while authorities seek to balance currency stability with the rising fiscal cost of supporting the industry.