The International Monetary Fund (IMF) has projected Zimbabwe’s economy to rebound with a 6 per cent growth rate this year, driven by improved agricultural output, record-high gold prices, and strong remittance inflows from citizens living abroad.
Economic growth slowed to 1.7 per cent last year, mainly due to drought conditions that reduced crop yields and hydroelectric power generation.
In a statement released on Thursday following a review of Zimbabwe’s economy, the IMF said that despite ongoing policy challenges, the country is experiencing a measure of macroeconomic stability. It said:
“Despite lingering policy challenges, Zimbabwe is experiencing a degree of macroeconomic stability. Growth is recovering from a sharp slowdown from 5 percent in 2023 to 1.7 percent in 2024, which was driven by a severe drought that significantly lowered agricultural and hydro-power electricity production, with knock-on effects to other sectors from power shortage.
“Declining prices for key metal exports also weighed on growth through lower mining output. Economic activity recovered in the first half of 2025, driven by better climate conditions, record high gold prices, and sustained workers’ remittances inflows.”
The IMF warned that growth could slow to 3.5 percent in the medium term due to persistently low confidence in the durability of economic stabilisation plans and the government’s reliance on domestic borrowing, which may constrain private credit growth. It said:
“Zimbabwe’s economic 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 remittance inflows.
“But foreign reserve buffers remain low despite recurring current account surpluses. In addition, growth is expected to slow (to about 3.5 percent) over the medium term, as market confidence in the durability of macroeconomic stabilisation remains low, and fiscal financing needs crowd out private sector growth.
“Inflation is expected to remain low, driven by tight monetary policy. Significant downside risks persist, notably from a return to monetary financing.”
The IMF noted that the government has been issuing Treasury bills to fund a significant accumulation of domestic arrears since last year, and called for a tighter fiscal stance to address these financing challenges.
The Fund also highlighted that the government continues to face a gap between official and parallel foreign exchange rates, despite the introduction of the gold-backed ZIG currency in April last year.
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