Zimbabwe's Debt Conundrum: Clearing Arrears and Securing Economic Stability

Zimbabwe's president convened with creditors to discuss plans for clearing $12.7 billion in external debt arrears. Negotiations are underway for an IMF Staff Monitored Program to enact key policy reforms. Clearing arrears is crucial for accessing international funding and easing the nation's debt burden.

Zimbabwe's president hosted a crucial meeting with creditors and finance executives on Monday, aiming to chart a path to clear $12.7 billion in external debt arrears. The initiative seeks to enable the cash-strapped country to access international capital markets for the first time in more than two decades.

President Emmerson Mnangagwa emphasized the significance of negotiating a Staff Monitored Program (SMP) with the International Monetary Fund. The program would pave the way for essential policy reforms, with support poised from the African Development Bank (AfDB) contingent on these developments.

Finance Minister Mthuli Ncube expressed hope that timelines for clearing arrears could become apparent by mid-2025. Achieving this milestone is critical to securing Zimbabwe's financial future according to Prosper Chitambara, a leading economist, who highlighted the economic benefits of reduced debt and increased investment.

(With inputs from agencies.)