Online Reporter
Business Reporter
The International Monetary Fund has signalled satisfaction with Zimbabwe’s economic stability, after confirming that the country met nearly all its end-March 2026 performance targets under a 10-month Staff-Monitored Programme.
In a statement following the conclusion of its mission to Harare, the IMF team — which met with Finance, Economic Development and Investment Minister Professor Mthuli Ncube, Reserve Bank of Zimbabwe (RBZ) governor Dr John Mushayavanhu and senior Government officials — praised the country’s macroeconomic resilience.
Driven by a rebound in agriculture, robust mining activity and favourable gold prices, Zimbabwe’s real gross domestic product grew by an exceptional 8,3 percent in 2025.
While the IMF projects growth to moderate to 5 percent for the remainder of 2026, it warned that an impending El Niño weather cycle could drag growth down to the 2 to 3 percent range next year.
“Programme implementation through end-March 2026 was satisfactory,” said the IMF team, which was led by Mr Wojciech Maliszewski.
“All quantitative targets were met, including those on the primary budget balance, net official international reserves, RBZ credit to the nonfinancial public sector, new external non-concessional borrowing, and ZiG monetary base growth.
“All indicative targets were met except one — the indicative target on protected social and priority spending was missed.
“The end-March structural benchmark on improving taxpayer register quality through quarterly monitoring and reporting of filing and payment compliance by new VAT (Value Added Tax) and PAYE (Pay as You Earn) registrants was met.
“The authorities are also making progress towards the end-June and end-September 2026 structural benchmarks.”
Despite the near-term economic momentum, the IMF’s evaluation highlights some structural policy pressures facing the country.
While the Government successfully hit quantitative targets for its primary budget balance and conservative budget execution, it failed its indicative target on protected social and priority spending.
The IMF strongly urged authorities to improve budget execution to ensure timely support to vulnerable populations, emphasising that structural reforms are “essential to consolidate stabilisation gains and strengthen public confidence”.
The RBZ’s tight monetary stance has kept inflation low — projected to average 5,1 percent in 2026 — while stabilising the structured currency, the Zimbabwe Gold (ZiG).
“Inflation has remained low, notwithstanding higher energy prices, reflecting tight monetary conditions and relative exchange rate stability, and is projected to average about 5,1 percent in 2026,” said the IMF.
The current account is expected to remain in surplus in 2026, supported by mining and agricultural exports and remittance flows, contributing to a continued increase in gross international reserves.
Growth is expected to moderate to 4,2 percent in 2027 under the baseline, with inflation remaining in single digits.
The IMF urged the central bank to maintain high interest rates until inflation expectations are firmly anchored and to transition away from non-negotiable certificates of deposit towards market-based instruments.
Furthermore, the IMF pressed the authorities to formulate a comprehensive strategy to liberalise the foreign exchange market and reform its current forex intervention framework to reduce persistent parallel market distortions.
The mission reiterated that resolving Zimbabwe’s massive external arrears and restoring long-term debt sustainability remain the ultimate hurdles to the country re-entering international capital markets.
While welcoming ongoing discussions with external partners, the IMF stressed that further financial assistance hinges on sustained progress under the SMP, meticulous debt data reconciliation, and a transparent strategy for creditor engagement.
The IMF welcomes the authorities’ commitment to maintaining spending within the approved 2026 national budget, while saving additional revenues to build buffers for potential food-security needs in 2027.
The team also welcomes commitments to contain fiscal risks from gold delivery incentives, including by assessing their continued relevance in the 2027 National Budget and limiting payments this year.
Strengthening budget execution, commitment controls, public financial management, and domestic arrears clearance will be critical to prevent new arrears and safeguard fiscal credibility, it said.
This evaluation arrives as local private sector players have increasingly applauded the country’s unprecedented economic stability.
Senior business executives report high predictability, with several noting that they do not see this positive momentum stopping anytime soon.
In recent market assessments, blue-chip beverage giant Delta Corporation projected its annual revenue to grow, driven by robust consumer demand and strategic volume growth.
Similarly, food manufacturing giant National Foods reported a highly stable operational environment and continued infrastructure investment, backed by strong consumer confidence.
Weighing in on the trajectory, economist Brains Muchemwa commended the growing culture of fiscal discipline among local policymakers, calling the current economic stability “historic” and a massive departure from previous years.
