ZIMBABWE has lifted its foreign currency import cover to 1,5 months for the first time in 21 months, marking a significant milestone in the country’s economic stabilisation efforts since the launch of the Zimbabwe Gold currency in April 2024.
Reserve Bank of Zimbabwe Governor Dr John Mushayavanhu said this in the central bank’s quarterly economic and monetary policy snapshot for the period ending December 31, 2025.
He said foreign currency reserves had risen to about US$1,2 billion, underpinned by strong export earnings, firm commodity prices and growing diaspora remittances.
The improvement places the country firmly on course to reach the internationally recommended three months’ import cover, a key macroeconomic buffer, sooner than initially anticipated, analysts say, especially against the backdrop of record gold prices and rising production.
“Foreign currency receipts averaged US$1,3 billion per month in 2025, against average external payment obligations of US$951,31 million, leaving a sizeable surplus,” Dr Mushayavanhu said.
That surplus averaged around US$400 million over the year, helping to support domestic transactions and build reserves, while the country is expected to record a current account surplus of more than US$1 billion in 2025, up sharply from US$501 million the previous year.
Economist Mr Malone Gwadu said the rise in import cover reflects a deliberate “back-to-basics” approach centred on rebuilding reserves and restoring confidence in the monetary system.
“It is quite assuring that the back-to-basics approach is now clearly on the horizon, with foreign currency reserves being attained and import cover gradually built,” Mr Gwadu said.
“With gold prices firming up, so too will our import cover, as reserves are largely supported by gold. This also strengthens the defensive capabilities of the ZiG, which is gold-backed.”
Gold prices have surged to unprecedented levels, reaching US$4 600 per ounce for the first time in 2026, while Zimbabwe breached the 45-tonne gold production mark in 2025.
The RBZ expects the momentum to continue this year, alongside strong platinum group metals prices.
Mr Gwadu said the next phase of reserve accumulation would be critical.
“The move towards three months’ import cover is a crucial threshold for a currency to hold the fort and gradually become internationally competitive,” he said.
Based on current inflows and commodity price trends, analysts estimate that Zimbabwe could reach the three-month benchmark within the next 12 to 18 months, faster than earlier projections made at the time of ZiG’s launch.
RBZ data shows that Zimbabwe’s foreign currency generation capacity grew by 21,8 percent to US$16,2 billion in 2025, from US$13,3 billion in 2024.
Export earnings dominated the inflow basket, accounting for an average 59,7 percent of total foreign currency receipts, followed by loan proceeds at 14,8 percent and diaspora remittances at 13,5 percent.
Banker Mr Raymond Madziva said the steady rise in remittance inflows was playing a quietly powerful role in strengthening the external position.
“Diaspora remittances are no longer just supporting household consumption, they are now a meaningful pillar of foreign currency receipts,” Mr Madziva said.
“The consistency of these flows improves liquidity in the formal market, reduces pressure on the exchange rate, and supports the broader reserve accumulation process.”
He said higher confidence in the banking system and improved exchange rate stability had encouraged more remittances to come through formal channels.
“When remittance receipts grow alongside exports, the impact on reserves is multiplied. It becomes easier for the central bank to smooth volatility and meet external obligations without strain,” Mr Madziva added.
Economist Mr Tinevimbo Shava said the progress towards three months’ import cover had far-reaching implications for macroeconomic stability.
“Internationally, three months’ import cover is considered the minimum safety buffer for any economy,” Mr Shava said.
“It ensures a country can continue importing essential goods such as fuel, medicines, electricity and industrial inputs even when external shocks occur.”
He said stronger reserves also enhance policy credibility.
“A healthy import cover supports exchange rate stability, lowers inflationary pressures, improves investor confidence and reduces reliance on short-term borrowing,” Mr Shava said.
“For Zimbabwe, it also strengthens the credibility of the ZiG by showing that the currency is backed not just in theory, but in actual reserve accumulation.”
The RBZ noted that merchandise trade was largely in surplus during the second half of 2025, while improved prices for key export minerals and continued growth in remittances are expected to further boost foreign currency receipts in 2026.
As global gold prices remain elevated and production trends remain favourable, Zimbabwe’s path to the three-month import cover benchmark now appears increasingly within reach, a development economists say could mark a turning point in the country’s long-running quest for macroeconomic stability.-herald
