Herald Reporter
Zimbabwe’s economy is expected to grow by 6 percent this year, buoyed by a strong agricultural season, record-high gold prices and sustained remittance inflows, according to the International Monetary Fund (IMF).
In its 2025 Article IV Consultation Report released on Friday, the IMF said growth would rebound from last year’s slowdown as extreme weather shocks eased and terms-of-trade improved, but urged more reforms to sustain the growth.
The Fund noted that tighter monetary policies — including the halting of quasi-fiscal operations and monetary financing by the Reserve Bank of Zimbabwe — had helped reduce inflation and ease exchange rate pressures.
Inflation is projected to remain relatively low this year, underpinned by tight liquidity management and ongoing efforts to stabilise the Zimbabwe Gold (ZiG) currency.
“GDP growth is expected to rebound to 6 percent this year and the current account surplus to widen, both driven by a good agricultural season, record-high gold prices and sustained remittances inflows,” the report said.
“The projections assume that the RBZ remains committed to stabilising the ZiG and keeping inflation relatively low, while building up reserves from continued current account surpluses and gold royalties remitted to the RBZ.”
The Fund urged authorities to implement a comprehensive reform package anchored on repairing structural weaknesses in public finances to secure fiscal discipline and enhancing the effectiveness and coherence of monetary and exchange rate policy.
On the fiscal side, the IMF recommended rationalising generous corporate tax incentives, strengthening tax administration and addressing spending pressures, particularly the public wage bill, while creating room for targeted social spending.
It also underscored the need for stronger planning to prevent further arrears accumulation.
“A degree of macroeconomic stability has been maintained recently,” said the multilateral lender.
“Tighter policies — notably the halting of quasi-fiscal operations and monetary financing by the central bank — have helped significantly reduce inflation and exchange rate pressures.
On the monetary front, the Fund encouraged Zimbabwe to move towards a transparent market-based foreign exchange system, with the exchange rate determined by market conditions, and reduced RBZ intervention.
It also urged reforms to strengthen liquidity management, improve the role of the ZiG, and provide clarity on the mono-currency transition plan.
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