In its article IV consultation report, the IMF said the country’s economic instability remains a challenge.
“While highly uncertain at this stage, it is clear that Covid-19 will adversely impact the economic outlook for Zimbabwe and require additional health-related spending and international support. Covid-19 will make it even harder to balance the policies needed to restore macroeconomic stability with those to address urgent social needs.
“Zimbabwe is experiencing an economic and humanitarian crisis. Macroeconomic stability remains a challenge: the economy contracted sharply in 2019, amplified by climate shocks that have crippled agriculture and electricity generation; the newly-introduced ZWL$ has lost most of its value; inflation is very high; and international reserves are very low.
“Executive directors noted with concern that Zimbabwe is facing an economic and humanitarian crisis exacerbated by policy missteps and climate‑related shocks. These would require difficult policy choices from the authorities and support from the international community.“Directors urged the authorities to make a concerted effort to ensure economic and social stability through the adoption of coordinated fiscal, monetary and foreign exchange policies, alongside with efforts to address food insecurity and serious governance challenges. They emphasised the importance of reengagement with the international community to support efforts to achieve economic sustainability and address the humanitarian crisis.”
“Such efforts would be instrumental to advance reengagement efforts with the international community and mobilise the needed support.“They noted with regret that the Staff‑Monitored Programme was off‑track and underscored the importance of continued engagement between the Fund and the authorities, including through technical assistance, policy advice and other innovative ways, to help immediately stabilise the economy and address the humanitarian crisis.”
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