Zimbabwe Passes First IMF Programme Assessment, but Risks Remain
THE International Monetary Fund (IMF) has completed the first review of Zimbabwe’s 10-month Staff-Monitored Programme (SMP), projecting continued single-digit inflation while warning that economic risks remain.
The milestone, approved by IMF management following the successful implementation of programme targets through March 2026, marks a significant step in Zimbabwe’s efforts to consolidate recent macroeconomic stability, strengthen its policy implementation record and advance arrears clearance, debt restructuring and re-engagement with the international community.
In a statement, the IMF said Zimbabwe’s economy remained resilient despite a challenging global environment.
“Despite a challenging global economic environment, Zimbabwe’s economy demonstrated resilience, achieving a growth rate of 8.3% in 2025. This performance was underpinned by improved agricultural output, strong mining activity, and favourable gold prices.
“The IMF projects economic growth to continue at 5% in 2026, moderating to 4.2% over the medium term, with inflation expected to remain in single-digit figures, contingent upon the maintenance of current macroeconomic policies.”
However, the Fund cautioned that the country’s outlook remains vulnerable.
“The outlook remains favourable, but risks are tilted to the downside,” the IMF said, citing the potential impact of a significant El Niño weather event and renewed conflict in the Middle East.
According to the IMF, Zimbabwe met all end-March quantitative targets under the programme, including those relating to the primary budget balance, net international reserves, Reserve Bank of Zimbabwe (RBZ) lending to the non-financial public sector, external borrowing limits and monetary base growth.
While most indicative targets were achieved, the Fund noted that the target for protected social and priority spending was missed.
The IMF also confirmed that structural benchmarks due at the end of March and June had been completed, with authorities continuing to implement subsequent reform commitments.
The Fund praised the government’s fiscal performance, saying the primary budget balance exceeded expectations on the back of stronger-than-expected revenue collections.
It urged authorities to maintain spending within the approved 2026 National Budget ceilings while saving any additional revenues to build buffers against possible food security challenges in 2027.
“We call for enhanced fiscal risk management, including tighter oversight of gold delivery incentives, improved public financial management, and measures to prevent the accumulation of new domestic arrears,” the IMF said.
The Reserve Bank of Zimbabwe was commended for maintaining a tight monetary policy stance, which the Fund said had helped contain inflation and ease pressure on the foreign exchange market.
The IMF also welcomed the operationalisation of the Zimbabwe dollar-denominated term deposit facility and encouraged authorities to continue developing market-based monetary policy instruments while further liberalising the foreign exchange market.
The Fund stressed that strengthening governance, fiscal risk management and social protection systems remains critical, adding that improved budget execution is necessary to ensure vulnerable groups receive timely and adequate support.
Continued implementation of reforms under the Staff-Monitored Programme, the IMF said, will strengthen Zimbabwe’s efforts to clear external arrears, restructure debt and deepen re-engagement with international financial institutions and development partners.
By New Zimbabwe.
