Online Reporter
Nelson Gahadza
ZIMBABWE has made commendable progress in implementing policies and measures that have bolstered economic stability and strengthened the domestic currency, according to International Monetary Fund (IMF) mission chief, Mr Wojciech Maliszewski.
Speaking after a courtesy call on President Mnangagwa at State House in Harare yesterday, Mr Maliszewski told journalists that the IMF team was in Zimbabwe to engage in discussions on the Staff Monitored Programme (SMP) and to conduct Article IV consultations, which are scheduled from June 4 to 18.
“We are here to discuss a Staff Monitored Programme, but also to participate in discussions on Article IV consultations.
“With regard to the SMP, we are making good progress in agreeing on policies aimed at enhancing the stability of the domestic currency, deepening the foreign exchange market, and ensuring that fiscal discipline is firmly embedded.
“These have been the key areas of focus in our discussions, particularly fiscal discipline and the operations of the forex market,” he said.
An SMP is an informal arrangement through which IMF staff work with national authorities to monitor and support the implementation of agreed economic reforms.
While it does not involve direct financial assistance, successful completion of an SMP helps a country establish a credible track record of sound fiscal and monetary policies — an essential step towards re-engagement with international lenders and resolving outstanding debt arrears.
Article IV consultations are routine, comprehensive assessments conducted by the IMF to evaluate a member country’s economic and financial health. These engagements provide a platform for dialogue between the Fund and the host government on economic policies, fiscal frameworks, and structural reforms.
Mr Maliszewski noted that the Article IV discussions also focus on Zimbabwe’s broader economic development prospects.
“We have been discussing various structural reforms to ensure that the progress we are witnessing is sustained and enhanced. Again, the two main areas of reform under discussion are fiscal policy and the forex market.
“For us, ensuring fiscal discipline and strengthening it through improvements in public financial management systems is critically important. This will reassure the people of Zimbabwe that the current macroeconomic stability will be maintained in the long term,” he said.
The primary objective of the SMP is to build a credible track record of sound economic policies, paving the way for Zimbabwe’s re-engagement with international creditors and the eventual resolution of debt arrears.
Mr Maliszewski said the Zimbabwe Gold (ZiG) currency is stable, and the goal is for it to become a fully-fledged national currency — both stable and widely used.
“To achieve this, several measures must be implemented. Chief among them is the development of a deeper forex market that ensures full price discovery.
“At present, we observe good stability in the official market and a narrowing gap between the parallel and official exchange rates. Ideally, we aim to eliminate this gap altogether,” he said.
He said that achieving a single exchange rate does not necessarily require depreciation of the currency.
“What it means is that the two rates must converge. With sound economic policies, there is a strong likelihood of convergence. This is the essence of the Staff Monitored Programme: to implement reforms that underpin fiscal stability, which in turn supports exchange rate stability,” said Mr Maliszewski.
Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube, who accompanied the IMF delegation, said the Government welcomed the mission.
He confirmed that the IMF team is in Zimbabwe for Article IV consultations on the state of the economy.
“We are also preparing to present the Mid-Term Budget Review and the Budget Strategy Paper for next year, as we refine our macroeconomic framework in line with National Development Strategy 2 (NDS 2) and Vision 2030.
“The second key issue is the SMP, which is a vital step in our arrears clearance roadmap.
“We have been discussing how to maintain the fiscal discipline we have established and ensure its continuation,” he said. Prof Ncube added that the Government is identifying areas of risk and considering appropriate mitigation strategies.
“In terms of fiscal discipline, we aim to live within our means. On the monetary front, we are addressing issues related to the forex market, particularly the parallel market, which could widen the gap between official and unofficial rates.
“Maintaining sound policies is one way to address this gap,” he said.
Prof Ncube noted that the ZiG has made significant progress and is now “essentially very stable”. He said the overall macroeconomic stability has been impressive, particularly the marked decline in month-on-month inflation.
“We must sustain this stability to keep inflation in check and provide a more predictable environment for businesses.
“I’ve visited several companies across the country, and it’s clear that this stability is welcomed. It enables businesses to plan and invest. Some have even expanded production lines and increased capacity utilisation due to the more predictable environment.
“The key question now is how to ensure this continues, and how the exchange rate can reflect market sentiment and build confidence,” he said.
Clearing arrears will unlock access to more affordable global capital, enabling Zimbabwe to finance its growth.
Zimbabwe is actively pursuing a comprehensive Arrears Clearance and Debt Resolution process, led by the African Development Bank (AfDB), with former Mozambican President Joaquim Chissano serving as the high-level facilitator.
The country’s total public debt is estimated at US$21 billion, comprising US$12.3 billion in external debt and US$8.7 billion in domestic debt.
