IMF kicks off crucial talks in Zimbabwe

SAMANTHA MADE

A high-level team from the International Monetary Fund (IMF) has began formal meetings with the Government of Zimbabwe, marking the start of a pivotal mission to assess the country’s reform progress under the Staff Monitored Programme (SMP).

The IMF delegation, which met with officials from the Ministry of Finance,  Economic Development and Investment Promotion in the capital Harare  yesterday, is in the country until June 18 for technical discussions aimed at evaluating Zimbabwe’s commitment to economic reforms and macroeconomic stability.

“The IMF team started the meetings today (yesterday). They are meeting the Ministry of Finance right now and they will be in the country until the 18th of June,” a senior Ministry of Finance, Economic Development and Investment Promotion official, who requested anonymity, told Business Times, a market leader in business, financial and economic reportage yesterday.

The visit is widely seen as a make-or-break moment for Zimbabwe’s reform agenda. While the SMP does not provide funding, its successful implementation is a prerequisite for future access to concessional financing, potential debt restructuring, and the rebuilding of confidence among international creditors and investors.

Finance,  Economic Development and Investment Promotion Minister  Professor Mthuli Ncube recently  emphasized the strategic importance of the visit, saying it offers Zimbabwe a platform to demonstrate both political will and policy discipline.

“This IMF mission is an important opportunity for Zimbabwe to showcase the work we’ve done on macroeconomic stabilization and reform implementation,” Ncube said. “The SMP is a foundation for re-engagement with the international financial system, and we are determined to stay the course.”

The Staff Monitored Programme is a non-lending framework in which IMF staff provide close technical support and policy advice while assessing the government’s ability to implement agreed-upon reforms. These include key structural and macroeconomic measures aimed at restoring fiscal discipline, stabilizing the currency, and improving public financial management.

This week’s review follows an earlier visit in January by an IMF team led by mission chief Wojciech Maliszewski. That visit launched Zimbabwe’s engagement under the current SMP, which the government had requested in 2023 to signal its commitment to economic reform and international re-engagement.

“We are focused on building a solid reform track record,” Professor Ncube said. “We want to demonstrate that we’re not just committing to policy changes on paper, but implementing real, measurable reforms.”

The stakes for Zimbabwe are especially high.

The country is saddled with a ballooning public debt that has now surpassed US$21bn, of which more than US$12.3bn is owed to external creditors.

Years of unpaid arrears have shut Zimbabwe out of concessional lending from the IMF, World Bank, and other international financial institutions.

With the economy still vulnerable and investor confidence fragile, a successful IMF review could signal a turning point.

Authorities hope the mission will validate the government’s reform efforts and support the broader debt resolution process being spearheaded by the African Development Bank (AfDB).

AfDB outgoing president Dr. Akinwumi Adesina has been leading efforts to create a platform for structured dialogue between Zimbabwe and its creditors, describing Zimbabwe’s economic reforms as “bold” and urging the international community to offer meaningful support.

“The SMP is both a test and a message,” said a Harare-based independent economist, Samuel Nkomo.

“If Zimbabwe passes this test, it paves the way for support from multilaterals and possibly private investors. But if it stumbles, it risks deeper economic isolation.”

While the Government of Zimbabwe has taken steps to strengthen policy credibility, several structural weaknesses remain. Inflation continues to be a major concern despite recent monetary tightening measures.

The introduced Zimbabwe Gold (ZiG) currency has shown some early signs of stability, but businesses remain cautious amid persistent doubts about currency sustainability and policy clarity.

The IMF has repeatedly flagged Zimbabwe’s quasi-fiscal activities—particularly those conducted through the Reserve Bank of Zimbabwe (RBZ)—as a source of macroeconomic imbalance. The Fund has also raised concerns over limited exchange rate transparency and gaps in public financial management systems.

“We have taken steps to strengthen fiscal responsibility, reduce reliance on central bank overdrafts, and enhance revenue collection,” Professor Ncube recently said. “We are aligning monetary and fiscal policy and implementing measures to stabilize the exchange rate.”

Beyond IMF validation, Zimbabwean authorities view the SMP as a catalyst for broader international re-engagement, including re-entry into global capital markets and eventual eligibility for concessional finance and investment flows.

Analysts believe the SMP framework can help Zimbabwe overcome its credibility deficit if consistently followed. The structured targets and monitoring mechanisms demand a level of transparency and accountability that has historically been missing from Zimbabwe’s policy execution.

Still, risks remain. A single misstep on sensitive issues—such as currency management, fiscal discipline, or RBZ transparency—could undo months of progress.

As the IMF delegation holds technical sessions with the Ministry of Finance, the RBZ, and other key agencies, expectations are rising. The mission’s findings could significantly influence Zimbabwe’s economic trajectory over the next 12 to 18 months.

With limited fiscal space, subdued growth, and rising public expectations, the government faces a delicate balancing act. Yet, officials remain confident.

What happens in Harare over the next two weeks could shape Zimbabwe’s place in the global economy for years to come. The stakes are high—and so is the opportunity.

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