The International Monetary Fund said on Thursday that Zimbabwe is operating in a complex macroeconomic environment that demands a delicate combination of economic and political reforms in order to restore stability and build the foundations for strong, sustainable and balanced growth.
Head of a visiting IMF mission Gene Leon said there is need for strong policy commitments by the Zimbabwean authorities to implement much needed reforms to restore stability, strengthen social protection, meaningfully improve transparency, improve foreign exchange policies and the monetary policy framework, and lay the foundations for a sustainable job-creating growth path.
“Policy actions are urgently needed to tackle the root causes of economic instability and enable private-sector led growth… Efforts will need to be intensified on both economic and political fronts to drive Zimbabwe forward,” Leon said in a statement at the end of Article IV consultations with the Zimbabwean authorities.
Zimbabwe has since the end of 2018 experienced unprecedented economic challenges, characterised by acute shortages of foreign currency to import fuel and electricity as well as rising food prices.
The country’s plight has been worsened by a severe drought that has piled pressure on the import bill amid indications that more than eight million people are in need of food assistance.
“GDP (gross domestic product) growth in 2019 is expected to be steeply negative as the effects of drought on agricultural production and electricity generation, impact of Cyclone Idai and the significant fiscal consolidation to correct past excesses serve to drag on growth,” the official warned.
JN/APA