LONDON — Zimbabwe is planning to intensify efforts in 2025 to rebuild its ties with Western governments, international financial institutions and global capital markets as part of a broader strategy to attract foreign investment, access concessional financing, and stimulate long‑term economic growth amid ongoing macroeconomic challenges, sources in Government have revealed.
The southern African nation has faced decades of strained relations with Western capitals, fuelled by contested land reform policies, governance concerns, and targeted sanctions under the United States’ Zimbabwe Democracy and Economic Recovery Act (ZDERA). While some sanctions were eased in recent years, Zimbabwe remains in arrears to key multilateral lenders and has yet to restore full financial access, complicating efforts to tap global capital markets.
A central obstacle to Zimbabwe’s reintegration into Western financial systems is its large stock of external debt and arrears. As of end‑2024, Zimbabwe’s public and publicly guaranteed debt stood at an estimated US$23.3 billion, with external arrears — including amounts owed to Paris Club members and multilateral institutions — reaching approximately US$7.4 billion, according to the International Monetary Fund.
Arrears to the World Bank, African Development Bank and European Investment Bank continue to mount, while the IMF has acknowledged the makings of macroeconomic stabilisation but remains unable to offer new lending until arrears are fully addressed.
Finance Minister Professor Mthuli Ncube has been a vocal advocate for reengagement with the IMF and World Bank, describing the clearance of arrears and improved economic governance as prerequisites for accessing concessional financing and encouraging private investment. He has highlighted token payments made to multilateral lenders as a signal of Zimbabwe’s commitment to resolving outstanding obligations.
The controversial land reform programme initiated under former President Robert Mugabe continues to cast a long shadow over Zimbabwe’s relations with Western investors and creditors, with compensation for displaced farmers emerging as a critical diplomatic issue. In 2025, the government made its first payments under a US$3.5 billion compensation agreement with former white commercial farmers, a move designed to address historical grievances and signal a willingness to meet Western expectations on property rights and restitution.
Government officials, including Foreign Affairs representatives and ZANU‑PF figures, have consistently emphasised that resolving the land question is essential to rebuilding trust with Western partners, pointing to compensation as part of efforts to bridge political differences and improve Zimbabwe’s investment climate.
Zimbabwe’s Ministry of Foreign Affairs has underscored the adverse impact of long‑standing arrears and isolation on the country’s ability to access offshore lending and international capital markets — effects amplified by a legacy of suspended access to World Bank and IMF programmes dating back to the early 2000s.
In response, Harare is pursuing a multi‑pronged diplomatic approach that includes structured dialogues with Paris Club members — including the United States, United Kingdom, Germany, France and Japan — aimed at coordinated debt treatment and eventual clearance. Officials have also sought to leverage diplomatic shifts in the West, including tensions between the United States, the European Union and key allies over geopolitical issues such as the Ukraine conflict, to reposition Zimbabwe as an alternative partner for Western investment in Africa.
Zimbabwe’s longstanding relationships with China and Russia are both an asset and a challenge in these efforts. Chinese investment — particularly in mining, infrastructure and energy — has been a cornerstone of Zimbabwe’s economic strategy, filling financing gaps left by Western disengagement. Beijing remains the single largest non‑Paris Club creditor and continues supporting major projects across the country.
IMF
While government officials, including Mthuli Ncube, have publicly praised Chinese contributions, they argue that diversified investment is vital. Broadening ties to Western capital could bring lower‑cost financing, access to international capital markets, and technology transfers that complement Chinese infrastructure financing — rather than supplant it.
Western investors have long cited governance concerns and corruption as key impediments to engagement in Zimbabwe. Targeted sanctions under the ZDERA and related measures have focused on individuals and entities accused of undermining democratic processes and economic governance. Although the broader sanction regime has been scaled down, restoring confidence among Western institutional investors — including major asset managers such as BlackRock, which has shown interest in Zimbabwean mining assets like Caledonia — hinges on transparent reforms and commitment to the rule of law.
Policy analysts argue that demonstrating credible progress on anti‑corruption measures, regulatory stability, transparent land policy and governance reforms would significantly improve Zimbabwe’s sovereign risk rating and appeal to Western pension funds, sovereign wealth funds and multinational corporations aiming to diversify supply chains for critical minerals and agricultural exports.
Zimbabwe’s participation in the Structured Dialogue Platform with creditors, including the IMF and Paris Club members, reflects a pragmatic shift towards negotiation and reform. Clearing arrears, agreeing on sustainable debt treatment terms and meeting governance benchmarks could unlock access to concessional financing and allow Zimbabwe to tap international capital markets for infrastructure financing, economic diversification and social development.
Central to these efforts is the ability of Finance Minister Mthuli Ncube and his team to navigate complex negotiations with Western creditors while balancing domestic political imperatives, including land reform and economic transformation.
As Zimbabwe continues its reengagement push, experts warn that tangible progress on debt resolution, transparent governance, and investor‑friendly policies will be essential to attract Western capital at scale. Success could position Zimbabwe as a strategic link between East and West — leveraging its rich natural resources and geographic advantage while offering Western investors a foothold in a rapidly transforming African economy.
