LIVINGSTONE MARUFUTreasury has raised US$90m and ZWG1.3bn through Treasury Bills (TBs) and private placements in the first half of 2025, intensifying its reliance on domestic borrowing to plug fiscal shortfalls and meet ballooning public wage obligations amid a deepening debt crisis.The move reflects Harare’s increasing financial isolation, with access to international credit markets constrained by longstanding external arrears With traditional lenders out of reach, the government has turned inward, leaning heavily on the local financial system to cover its funding gaps.Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, confirmed the figures and emphasized the critical role of commercial paper in the government’s financing mix.“During the period January to June 2025, Treasury mobilised resources for budget financing totaling ZWG1.3bn, including US$90m Treasury Bills, through the issuance of domestic securities These resources were mobilised from the banking sector through private placement,” Professor Ncube said.He added: “Treasury is working on the re-introduction of Government securities auction system for competitiveness and price discovery.”The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills
Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing
The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise
This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate
With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
Treasury has raised US$90m and ZWG1.3bn through Treasury Bills (TBs) and private placements in the first half of 2025, intensifying its reliance on domestic borrowing to plug fiscal shortfalls and meet ballooning public wage obligations amid a deepening debt crisis.The move reflects Harare’s increasing financial isolation, with access to international credit markets constrained by longstanding external arrears With traditional lenders out of reach, the government has turned inward, leaning heavily on the local financial system to cover its funding gaps.Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, confirmed the figures and emphasized the critical role of commercial paper in the government’s financing mix.“During the period January to June 2025, Treasury mobilised resources for budget financing totaling ZWG1.3bn, including US$90m Treasury Bills, through the issuance of domestic securities These resources were mobilised from the banking sector through private placement,” Professor Ncube said.He added: “Treasury is working on the re-introduction of Government securities auction system for competitiveness and price discovery.”The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills
Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing
The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise
This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate
With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
The move reflects Harare’s increasing financial isolation, with access to international credit markets constrained by longstanding external arrears With traditional lenders out of reach, the government has turned inward, leaning heavily on the local financial system to cover its funding gaps.Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, confirmed the figures and emphasized the critical role of commercial paper in the government’s financing mix.“During the period January to June 2025, Treasury mobilised resources for budget financing totaling ZWG1.3bn, including US$90m Treasury Bills, through the issuance of domestic securities These resources were mobilised from the banking sector through private placement,” Professor Ncube said.He added: “Treasury is working on the re-introduction of Government securities auction system for competitiveness and price discovery.”The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills
Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing
The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise
This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate
With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, confirmed the figures and emphasized the critical role of commercial paper in the government’s financing mix.“During the period January to June 2025, Treasury mobilised resources for budget financing totaling ZWG1.3bn, including US$90m Treasury Bills, through the issuance of domestic securities These resources were mobilised from the banking sector through private placement,” Professor Ncube said.He added: “Treasury is working on the re-introduction of Government securities auction system for competitiveness and price discovery.”The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued
The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named
“The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said
“This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
“During the period January to June 2025, Treasury mobilised resources for budget financing totaling ZWG1.3bn, including US$90m Treasury Bills, through the issuance of domestic securities
These resources were mobilised from the banking sector through private placement,” Professor Ncube said.He added: “Treasury is working on the re-introduction of Government securities auction system for competitiveness and price discovery.”The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees
However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt
According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
He added: “Treasury is working on the re-introduction of Government securities auction system for competitiveness and price discovery.”The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills
Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing
The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise
This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate
With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
The TB issuances came with varying interest rates depending on the currency and maturity Local currency TBs were floated at 13.0% for 90-day tenors, 14.0% for 180-day instruments, and 14.5% for 270-day bills Meanwhile, the US dollar-denominated Treasury Bills were issued at 12.5% for the 90-day tenor and 6.0% for the 365-day tenor.In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees
However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt
According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
In the first quarter of 2025, a total of ZWG779.44m and US$84.91m were issued The second quarter saw an additional ZWG1.16bn and US$95.79m raised, with projections of US$20m to be raised in the second half of the year.Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees
However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt
According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
Globally, Treasury Bills are viewed as safe and liquid investments backed by sovereign guarantees However, in Zimbabwe’s context, their reputation has been tainted by past defaults, central bank overdrafts, and fiscal indiscipline
In previous years, billions of Zimbabwean dollars were issued via the central bank’s overdraft facility, fueling hyperinflation and widespread erosion of trust in government debt instruments.As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024
An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears
The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
As a result, TBs in Zimbabwe have become synonymous with unsustainable borrowing The consequences included chronic budget deficits and dwindling investor confidence, which the government is still struggling to rebuild.Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt
According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
Economists warn that the renewed push for TBs could reignite inflationary pressures and weaken macroeconomic stability.“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt
According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
“There is a very real risk of inflationary pressure being reignited,” said one Harare-based economist who declined to be named “The government is increasingly leaning on domestic instruments to cover budget deficits, but without fiscal discipline, this could destabilise the macroeconomic environment once again.”The warning comes as Treasury grapples with a mounting backlog of maturing debt
According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024 An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
The warning comes as Treasury grapples with a mounting backlog of maturing debt According to the Zimbabwe Public Debt Management Office (ZPDMO), which falls under Professor Ncube’s purview, TBs worth US$177m matured in the fourth quarter of 2024
An additional US$738m is set to mature in 2025, bringing the total exposure under review to nearly US$915m.To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted “There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears
The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
To ease the repayment burden, the government is undertaking a comprehensive debt restructuring exercise This includes efforts to extend debt maturities, reduce interest payments, and convert short-term obligations into longer-term securities.“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
“The Treasury is working on a debt restructuring plan aimed at easing repayment pressures,” Professor Ncube said “This includes extending maturity profiles, reducing coupon payments, or converting short-term TBs into longer-term debt instruments.”However, economists caution that if the restructuring is not conducted transparently and prudently, it could further undermine confidence in Zimbabwean debt markets.“If the restructuring is not done in a good way, we may end up with a worse situation,” a local financial analyst noted
“There is a real risk of crowding out the private sector and escalating the government’s borrowing costs.”Zimbabwe’s heavy reliance on domestic debt comes against the backdrop of a staggering external debt stock estimated at over US$14bn, much of it in arrears The country’s default status has shut it out of concessional financing windows from institutions such as the International Monetary Fund (IMF), World Bank, and African Development Bank (AfDB).With international options limited, the government is increasingly turning to local banks and pension funds to fund its operations—raising red flags about the long-term sustainability of its borrowing model.Although Treasury is working on reintroducing an auction system to enhance transparency and price discovery in government securities markets, analysts say this alone will not be enough to reverse the damage.“As long as there’s no broader fiscal reform and restoration of credibility, no amount of auction-based pricing will convince investors that their money is safe,” the economist said.As Zimbabwe enters the second half of 2025, the government’s balancing act between meeting short-term fiscal needs and safeguarding long-term macroeconomic stability has never been more delicate With nearly US$1bn in TBs coming due and confidence still fragile, the next few months may prove decisive in determining whether Zimbabwe’s domestic debt gamble pays off—or deepens the country’s economic woes.Related
Source: Businesstimes
