News / National
IMF kicks off crucial talks in Zimbabwe
05 Jun 2025 at 11:33hrs | Views
A high-level delegation from the International Monetary Fund (IMF) has begun formal meetings with Zimbabwean authorities, launching a critical mission to assess the country's reform trajectory under the ongoing Staff Monitored Programme (SMP).
The IMF team, which held its first round of discussions with officials from the Ministry of Finance, Economic Development and Investment Promotion in Harare yesterday, is expected to remain in the country until June 18. The mission's objective is to conduct a technical evaluation of Zimbabwe's commitment to macroeconomic reforms and policy stability.
"The IMF team started the meetings today (yesterday). They are engaging with the Ministry of Finance and will be in the country until the 18th of June," a senior official from the ministry told Business Times on condition of anonymity.
The SMP is a non-lending arrangement that allows IMF staff to monitor the government's reform performance and provide policy guidance. While it does not involve direct financial support, a successful review is considered essential for unlocking future concessional financing, debt restructuring opportunities, and renewed engagement with international creditors and investors.
Finance Minister Professor Mthuli Ncube has underscored the significance of the visit, stating that it offers Zimbabwe an opportunity to reaffirm its commitment to reform and re-engagement.
"This IMF mission is an important opportunity for Zimbabwe to showcase the work we've done on macroeconomic stabilization and reform implementation," said Prof. Ncube. "The SMP is a foundation for re-engagement with the international financial system, and we are determined to stay the course."
The current review builds on an earlier visit in January, led by IMF mission chief Wojciech Maliszewski, which marked the start of Zimbabwe's engagement under the renewed SMP. The programme focuses on structural and macroeconomic reforms aimed at restoring fiscal discipline, stabilising the currency, and improving public financial management.
Since then, the Zimbabwean government has introduced several policy measures, including tighter monetary policy, enhanced revenue collection efforts, and the launch of the Zimbabwe Gold (ZiG) currency. While ZiG has shown early signs of stability, market confidence remains tentative amid lingering concerns over long-term sustainability and policy coherence.
Zimbabwe's economic challenges are significant. The national public debt has surged to over US$21 billion, including more than US$12.3 billion owed to external creditors. Years of arrears have excluded the country from accessing support from multilateral financial institutions such as the IMF and World Bank.
A successful IMF review is therefore seen as pivotal to rebuilding credibility and supporting the broader debt resolution process being spearheaded by the African Development Bank (AfDB). Outgoing AfDB president Dr. Akinwumi Adesina has praised Zimbabwe's reform efforts as "bold" and called on the international community to provide tangible support.
"This SMP is both a test and a message," said Harare-based independent economist Samuel Nkomo. "If Zimbabwe passes this test, it opens doors to international capital and donor support. But any serious misstep could lead to deeper isolation."
Key reform areas under IMF scrutiny include transparency in public financial management, reduction of quasi-fiscal activities by the Reserve Bank of Zimbabwe (RBZ), alignment of monetary and fiscal policy, and improved exchange rate practices.
"We have taken steps to strengthen fiscal responsibility, reduce reliance on central bank overdrafts, and align monetary and fiscal strategies," Prof. Ncube noted.
The IMF has previously raised concerns about the opacity of the foreign exchange market and the impact of central bank operations on inflation. Although inflationary pressures have eased somewhat due to recent policy tightening, risks persist, and structural reforms remain incomplete.
The outcome of this month's mission is expected to significantly influence Zimbabwe's economic direction over the next 12 to 18 months. With constrained fiscal space, high public expectations, and a fragile recovery, the government must navigate the path ahead with both caution and resolve.
As technical consultations continue with the Ministry of Finance, the RBZ, and other institutions, anticipation is growing over the IMF's findings. For Zimbabwe, the next two weeks may prove decisive in its long journey toward economic recovery and international reintegration.
The IMF team, which held its first round of discussions with officials from the Ministry of Finance, Economic Development and Investment Promotion in Harare yesterday, is expected to remain in the country until June 18. The mission's objective is to conduct a technical evaluation of Zimbabwe's commitment to macroeconomic reforms and policy stability.
"The IMF team started the meetings today (yesterday). They are engaging with the Ministry of Finance and will be in the country until the 18th of June," a senior official from the ministry told Business Times on condition of anonymity.
The SMP is a non-lending arrangement that allows IMF staff to monitor the government's reform performance and provide policy guidance. While it does not involve direct financial support, a successful review is considered essential for unlocking future concessional financing, debt restructuring opportunities, and renewed engagement with international creditors and investors.
Finance Minister Professor Mthuli Ncube has underscored the significance of the visit, stating that it offers Zimbabwe an opportunity to reaffirm its commitment to reform and re-engagement.
"This IMF mission is an important opportunity for Zimbabwe to showcase the work we've done on macroeconomic stabilization and reform implementation," said Prof. Ncube. "The SMP is a foundation for re-engagement with the international financial system, and we are determined to stay the course."
The current review builds on an earlier visit in January, led by IMF mission chief Wojciech Maliszewski, which marked the start of Zimbabwe's engagement under the renewed SMP. The programme focuses on structural and macroeconomic reforms aimed at restoring fiscal discipline, stabilising the currency, and improving public financial management.
Since then, the Zimbabwean government has introduced several policy measures, including tighter monetary policy, enhanced revenue collection efforts, and the launch of the Zimbabwe Gold (ZiG) currency. While ZiG has shown early signs of stability, market confidence remains tentative amid lingering concerns over long-term sustainability and policy coherence.
A successful IMF review is therefore seen as pivotal to rebuilding credibility and supporting the broader debt resolution process being spearheaded by the African Development Bank (AfDB). Outgoing AfDB president Dr. Akinwumi Adesina has praised Zimbabwe's reform efforts as "bold" and called on the international community to provide tangible support.
"This SMP is both a test and a message," said Harare-based independent economist Samuel Nkomo. "If Zimbabwe passes this test, it opens doors to international capital and donor support. But any serious misstep could lead to deeper isolation."
Key reform areas under IMF scrutiny include transparency in public financial management, reduction of quasi-fiscal activities by the Reserve Bank of Zimbabwe (RBZ), alignment of monetary and fiscal policy, and improved exchange rate practices.
"We have taken steps to strengthen fiscal responsibility, reduce reliance on central bank overdrafts, and align monetary and fiscal strategies," Prof. Ncube noted.
The IMF has previously raised concerns about the opacity of the foreign exchange market and the impact of central bank operations on inflation. Although inflationary pressures have eased somewhat due to recent policy tightening, risks persist, and structural reforms remain incomplete.
The outcome of this month's mission is expected to significantly influence Zimbabwe's economic direction over the next 12 to 18 months. With constrained fiscal space, high public expectations, and a fragile recovery, the government must navigate the path ahead with both caution and resolve.
As technical consultations continue with the Ministry of Finance, the RBZ, and other institutions, anticipation is growing over the IMF's findings. For Zimbabwe, the next two weeks may prove decisive in its long journey toward economic recovery and international reintegration.
Source - Business Times
