By HARARE — The International Monetary Fund (IMF) announced that its staff team and Zimbabwean authorities have reached a staff-level agreement on the second review of Zimbabwe’s 10-month Staff-Monitored Program (SMP), which was initially approved in March 2026.
Led by Mr. Wojciech Maliszewski, the IMF mission visited Harare from September 7 to 17, 2026, to evaluate economic performance and structural reforms.
The agreement, which is subject to approval by IMF Management, represents a critical milestone in Zimbabwe’s ongoing efforts to consolidate macroeconomic stability, clear external arrears, restructure debt, and re-engage with the international community.
Strong Economic Performance and Robust Growth Projections
Zimbabwe’s economic indicators continue to demonstrate resilience following a robust expansion of 8.3% in 2025. The economy is projected to grow by 5% through 2026, bolstered by strong export receipts and consistent remittance inflows that keep the current account in surplus.
Furthermore, tight monetary conditions and relative exchange rate stability successfully drove annual inflation down to a low single-digit rate of 2.9% by August 2026.
Looking ahead to 2027, economic growth is expected to moderate to 3.5% due to the anticipated impact of a severe El Niño event. Despite this meteorological headwind, inflation is projected to stay in single digits and the current account is expected to maintain a surplus, provided that the government’s planned mitigation measures are executed efficiently.
Program Targets Met, with Focus on Social Spending Bottlenecks
Program implementation through the end of June 2026 was notably strong, with nearly all quantitative and structural benchmarks met. Key structural milestones achieved include:
- Publishing the finalized user manual for the Zimbabwe Social Registry (ZISO).
- Developing a Treasury Single Account reform strategy.
- Advancing public financial and debt management, including bringing U.S. dollar payments into the public financial management system.
However, the IMF flagged a shortfall in protected social and priority spending as a significant concern. While fiscal performance outperformed expectations due to robust revenue collection, the missed social spending target underscores existing implementation bottlenecks. The IMF emphasized the urgent need to improve cash planning and budget execution so that critical resources reach vulnerable households and priority programs in a timely manner.
Monetary Reform and Governance Enhancements
The Reserve Bank of Zimbabwe (RBZ) maintained a tight monetary policy stance, successfully containing foreign exchange market pressures and anchoring low inflation. The RBZ has progressed in developing an electronic foreign exchange trading platform alongside a comprehensive strategy to liberalize the foreign exchange market and refine the foreign exchange intervention framework. These steps are designed to strengthen public confidence in the domestic currency, the ZiG.
Governance and fiscal transparency have also seen tangible improvements. The authorities have advanced the preparation of the National Anti-Corruption Strategy 2 and published the financial statements of the Mutapa Investment Fund, alongside progress toward publishing the financial statements of its portfolio companies.
Path Forward on Debt Resolution
Resolving Zimbabwe’s deep-seated external arrears and restoring debt sustainability remain the cornerstone of the country’s re-engagement strategy. Maintaining disciplined policy execution, advancing liability management frameworks, and continuing robust data reconciliation with creditors will be vital to moving forward with the arrears-clearance process.
