February 13, 2025
In Harare, Zimbabwe, an International Monetary Fund (IMF) team led by Wojciech Maliszewski completed discussions on a Staff-Monitored Program (SMP) with Zimbabwean authorities. The mission took place from January 30 to February 13, 2025.
Wojciech Maliszewski stated: “Zimbabwe’s economic activity has started recovering after the El Niño-induced drought. Growth slowed from 5.3 percent to an estimated 2 percent in 2024, as the drought lowered agricultural output by 15 percent. This was compounded by reduced electricity production and declining prices for key mineral exports (platinum and lithium). That said, strong remittances continued supporting activity in domestic trade, services, and construction, and improved the current account surplus to an estimated US$500 million (1.4 percent of GDP) in 2024."
He added that fiscal pressures increased due to the transfer of quasi-fiscal operations to the Treasury. Despite strong revenue collection limiting the budget deficit to an estimated 1 percent of GDP in 2024, expenditure arrears accumulated. Emergency spending cuts were implemented as a result.
Looking ahead to 2025, growth is projected at 6 percent due to better climate conditions improving agriculture output and expected favorable terms-of-trade changes.
The SMP aims to stabilize Zimbabwe's economy and re-engage internationally on debt resolution. Its objectives include anchoring macroeconomic stability based on policy recommendations from the previous year's Article IV consultation.
Maliszewski outlined areas of focus: adjusting fiscal positions without resorting to monetary financing or new arrears; managing off-budget fiscal risks; enhancing monetary policy effectiveness; and reforming economic governance.
International engagement remains crucial for resolving debt issues and accessing external financing through efforts like the Structured Dialogue Platform (SDP).
“The IMF continues to provide policy advice and extensive technical assistance," Maliszewski noted. However, financial support is not possible until there is a clear path for restructuring Zimbabwe's external debt.
During its mission, the IMF met with Finance Minister Mthuli Ncube, Reserve Bank Governor John Mushayavanhu, other government officials, parliament members, private sector representatives, civil society groups, and development partners.
The IMF staff expressed gratitude for "the constructive and open discussions" held during their time in Zimbabwe.