Zimbabwe’s Debt Resolution Gains Momentum Amid Reforms, but Governance Hurdles Remain

“The parameters of the dialogue have been set. Most issues have been dealt with. Commitments and targets have been agreed upon,” said Chissano, celebrating the substantial reforms already undertaken.

After nearly two years of concerted efforts, Zimbabwe’s ambitious arrears clearance and debt resolution programme has entered a critical new phase, drawing international acclaim while facing key governance challenges. This development emerged during a high-level roundtable on the sidelines of the Spring Meetings of the International Monetary Fund (IMF) and World Bank Group in Washington, D.C.

Broad Acknowledgement of Progress

The roundtable brought together a host of global stakeholders including senior officials from the IMF, World Bank, African Development Bank (AfDB), Southern African Development Community (SADC), and representatives from Western governments such as the Netherlands, France, the UK, and Germany. Facilitated by former Mozambican President Joachim Chissano, the dialogue centred on reviewing Zimbabwe’s performance in a structured three-pillar reform process initiated to resolve its longstanding debt and arrears.

“The parameters of the dialogue have been set. Most issues have been dealt with. Commitments and targets have been agreed upon,” said Chissano, celebrating the substantial reforms already undertaken.

Dr. Akinwumi Adesina, President of the African Development Bank and the appointed champion of the dialogue, echoed these sentiments. “Zimbabwe has made a lot of progress, against all odds,” he said, highlighting economic stabilisation efforts and land reform milestones. Nonetheless, he warned that recent legislative developments, such as the enactment of the Private Voluntary Organization (PVO) Bill, threaten to undermine gains in governance and civil liberties.

Pillar Achievements: Economy and Land Reforms

Progress has been notable in two key reform pillars—economic growth and stability, and land reform.

On the economic front, Zimbabwe has taken significant strides. The Reserve Bank of Zimbabwe ceased quasi-fiscal activities, with liabilities transferred to the Treasury. A new currency, ZiG, was introduced in April 2024, bolstering monetary stability. Additionally, exchange rate adjustments now reflect market-based principles, while fiscal policies have become more prudent.

Land reform also saw encouraging developments. The government launched the Farm Title Deed Programme in December 2024, offering transferable and bankable 99-year leases. More significantly, compensation payments began flowing to former commercial farm owners—decades after their displacement during the Fast Track Land Reform Programme. On March 24, 2025, the first US dollar cash disbursements were made, a milestone hailed by Andrew J. Pascoe, former president of the Commercial Farmers Union, as “a momentous event.”

Governance: The Achilles Heel

While the economic and land reforms were praised, stakeholders unanimously agreed that governance remains the weak link. Issues of civil society participation, electoral integrity, judicial independence, and freedoms of assembly and expression remain unresolved.

“There are significant reforms underway—abolishing the death penalty, improving public sector transparency, and fighting corruption—but we must not ignore the gaps,” said Chissano. He urged the continuation of dialogue to cement political reforms, which he emphasized are “not a linear process.”

Adesina noted that political space is crucial for sustainable development and warned that the PVO Bill risks alienating civil society actors and international partners.

Strategic Financial and Institutional Support

Adesina outlined a roadmap for concluding the arrears clearance. Key steps include:

• IMF approval of a Staff Monitored Programme (SMP) in 2025,

• Donor support for a $2.6 billion bridge loan facility,

• Additional resources mobilised through the AfDB’s 17th African Development Fund replenishment, and

• Engagement with the World Bank’s International Development Association (IDA) to clear remaining arrears.

He revealed that the AfDB is financing the services of Global Sovereign Advisory and legal firm Kepler-Karst to provide technical guidance and establish clear timelines for resolution.

Zimbabwe’s Economic Outlook

Finance Minister Mthuli Ncube presented a cautiously optimistic economic forecast. He projected 6.0% GDP growth in 2025, a dramatic recovery from the 2.0% contraction in 2024 due to a severe drought. He reiterated that the ZiG currency and tighter fiscal management are beginning to bear fruit.

Zimbabwe’s roadmap includes full clearance of arrears to international financial institutions by early 2026 and a comprehensive restructuring under the G20 Common Framework.

Regional Backing and International Solidarity

Elias M. Magosi, Executive Secretary of SADC, emphasized Zimbabwe’s critical role in regional integration and trade. He called for continued international backing to ensure the country’s reintegration into the global financial community.

President Mnangagwa’s 2018 commitment to compensate displaced farmers is being honoured, as noted by Pascoe. “We were able to put aside our differences and negotiate an agreement in an atmosphere of mutual respect,” he said.

Final Stretch in a Long Journey

Nearly three years ago, Zimbabwe entrusted Dr. Adesina with the task of spearheading the dialogue. Though acknowledging the difficulties, Adesina affirmed his belief in the success of the initiative. “We will succeed in giving Zimbabwe and its people a full arrears clearance and debt resolution,” he vowed.

As the country nears the final stretch of its debt resolution journey, stakeholders are called upon to maintain momentum and broaden consensus, especially in the critical governance domain.