Zim on the right path to economic stability

Zim on the right path to economic stability - IMF

International Monetary Fund: Financial risks need to be balanced out

Zim Now Writer

The International Monetary Fund has noted a significant decline in currency and price pressures for Zimbabwe, attributing them to a tight monetary policy that has been adopted by the country. There are, however, some grey areas that still need attention.

The remarks are contained in a statement issued by IMF upon its completion of Article IV Mission to Zimbabwe following a working visit by a delegation from the global financier between December 1-15.

"The IMF mission notes the authorities' efforts to stabilise the local foreign exchange market and lower inflation.

"In this regard, the swift tightening of monetary policy, along with greater official exchange rate flexibility and a prudent fiscal stance, are policies in the right direction and have contributed to a narrowing of the premia in the parallel foreign exchange market."

A declining annual inflationary pressure, which had risen to a high of 285% to the current 255%, was also noted.

Despite Zimbabwe being a member, the IMF said it was precluded from providing financial support to the country owing to official external arrears and unsustainable debt.

"A fund financial arrangement would require a clear path to comprehensive restructuring of Zimbabwe's external debt, including the clearance of arrears and a reform plan that is consistent with durably restoring macroeconomic stability, enhancing inclusive growth, lowering poverty, and strengthening economic governance," the statement said.