Zimbabwe plans to resume discussions with creditors later this month in efforts to restructure $21 billion in external debt, aiming to end a prolonged default that has excluded it from international capital markets since 1999.
Zimbabwean Finance Minister Mthuli Ncube, speaking at a pre-budget seminar in Bulawayo, announced a high-level dialogue scheduled for November 25 with creditors, including the African Development Bank (AfDB) President Akinwumi Adesina and former Mozambican President Joaquim Chissano. Both were appointed by President Emmerson Mnangagwa in 2022 to mediate talks with major creditors, such as the World Bank, Paris Club, and European Investment Bank.
In preparation, Zimbabwe recently engaged financial advisors to assist with the restructuring process. The longstanding arrears have prevented Zimbabwe from securing funding from multilateral organizations like the International Monetary Fund, compelling the country to rely on the central bank for borrowing. This financial isolation has intensified inflation pressures and disrupted Zimbabwe’s attempts to establish a stable local currency.
At the seminar, Reserve Bank Deputy Governor Innocent Matshe advised Ncube to bolster measures supporting the adoption of ZiG (Zimbabwe Gold), a gold-backed digital currency launched in April to replace the U.S. dollar in local transactions. Matshe also stated that the Reserve Bank will maintain strict monetary policies to curb excess liquidity, stabilize the currency, and control inflation, which spiked to 37.2% in October. The bank expects inflation to decrease to under 5% by year-end and to below 1% in 2025.
