IMF and Zimbabwe Seal Reform Deal as New Monitoring Programme Takes Shape

The International Monetary Fund and Zimbabwe have reached a staff-level agreement on a new 10-month Staff-Monitored Program aimed at consolidating recent economic stabilisation gains and strengthening macroeconomic management, in a move seen as critical to the country’s re-engagement with international creditors.

The agreement follows discussions held in Harare from 28 January to 6 February 2026 between IMF staff and Zimbabwean authorities. The talks were led by Wojciech Maliszewski and focused on economic policies and reforms designed to entrench stability, improve policy credibility, and support Zimbabwe’s longer-term strategy on arrears clearance and debt restructuring. The staff-level agreement remains subject to IMF Management approval.

According to the IMF, the proposed programme is aligned with Zimbabwe’s National Development Strategy 2 and places strong emphasis on prudent budget execution, strengthened cash and expenditure controls, sustained monetary discipline, and governance reforms to improve transparency and manage fiscal risks. Social protection measures also form a core part of the programme framework.

Zimbabwe’s recent economic performance underpinned the agreement. Growth in 2025 exceeded initial projections of 6.6 percent, supported by strong agricultural output and a rebound in mining, particularly gold, platinum, and lithium. Inflation declined to 4.1 percent in January 2026, aided by exchange rate stability and tight monetary conditions. Fiscal revenues improved over the year, narrowing the deficit and delivering a small primary surplus.

The IMF projects growth of around 5 percent in 2026, with inflation expected to remain in single digits. The current account is forecast to stay in surplus at about 3.8 percent of GDP, while the primary fiscal balance is expected to record a surplus of roughly 0.5 percent of GDP. The programme seeks to build on these trends by deepening confidence in the ZiG currency, improving the functioning of the foreign exchange market, and rebuilding reserve buffers.

Fiscal discipline is central to the programme design. Spending in the first half of 2026 will be anchored to a conservative revenue outlook to prevent the accumulation of new domestic arrears. Authorities have also committed to strengthening arrears monitoring through regular reporting and clearer institutional responsibilities, alongside improvements in cash planning and short-term liquidity forecasting.

Public financial management reforms will be advanced over time, including tighter budget controls, improved capture of commitments, and steps towards establishing a Treasury Single Account. These measures are intended to enhance transparency, efficiency, and predictability in public spending.

Governance reforms feature prominently, particularly in relation to state-owned enterprises. Following the publication of its inaugural financial statement, the Mutapa Investment Fund is expected to publish audited financial statements for all entities under its portfolio in line with the Public Financial Management Act, and to continue refraining from contracting debt without prior approval from the Ministry of Finance.

The programme also supports the full operationalisation of the Zimbabwe Social Registry to improve the targeting and delivery of social assistance, ensuring that vulnerable households are better protected as reforms continue.

For the IMF, the Staff-Monitored Program is intended to help Zimbabwe establish a credible reform track record that supports re-engagement with international partners and lays the groundwork for more substantive discussions on arrears clearance and debt restructuring, including eventual access to concessional financing.

From an African perspective, Zimbabwe’s path reflects the broader reality faced by many young economies across the continent. Stabilisation is not an end in itself but a foundation for rebuilding trust, institutions, and social contracts strained by years of shocks. As African states navigate reform under intense domestic pressures, the challenge remains to balance fiscal discipline with protection for the most vulnerable, ensuring that recovery translates into durable and inclusive growth.