THE presentation of Zimbabwe’s 2026 National Budget has cast a harsh spotlight on a fiscal crisis that is both deepening and evolving, analysts said this week.
While the government’s latest debt report presented a series of technically-sophisticated solutions, a closer analysis reveals a fundamental disconnect between financial planning and the political-economic realities on the ground.
The crisis has moved beyond spreadsheets and into the realm of human welfare and political will.
The core figures are severe. Zimbabwe’s Total Public and Publicly Guaranteed debt has climbed to US$23,4 billion, an 8,5% increase in just nine months.
This continued growth, as development economist Chenayimoyo Mutambasere noted, “highlights an inability to stabilise the debt path despite repeated commitments to fiscal consolidation”.
However, the most alarming revelation is not the stock of debt itself, but its dynamic and destructive composition. Domestic expenditure arrears — unpaid bills to contractors, suppliers and service providers — have exploded from a relatively contained US$34 million in December 2024 to a staggering US$1,3 billion by September 2025.
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This near 40-fold increase signifies a systemic breakdown.
As Mutambasere analyses, this “unprecedented explosion” signals “a collapse in payment discipline within government ministries and agencies, over-contracting and off-budget spending beyond appropriated funds; (and) fragmented commitment controls”.
This practice has turned arrears into the “primary driver of domestic debt”, creating profound instability for small and medium-sized enterprises that form the backbone of the private sector.
Experts argued the crisis has fundamentally transcended economics. John Maketo, director of the Zimbabwe Coalition on Debt and Development, framed it as a “human development emergency”.
The mechanism of this emergency, he argued, is “silent austerity”.
“Massive, fast-growing arrears, especially to social sectors and workers, amount to a form of silent austerity,” Maketo stated.
“This silent austerity “starves” these critical areas of funding, with the burden “falling disproportionately on the poor and on future generations”.
The situation is exacerbated by what Maketo identified as an “elite bias” in the domestic debt composition, which he said prioritises “politically sensitive obligations”, such as compensation for former farm owners over “everyday social needs”.
In his 2026 National Budget, Finance minister Mthuli Ncube unveiled strategies that are, in the words of economist Stevenson Dhlamini, “technically sound, innovative and represent the pinnacle of modern debt management theory”.
The centrepiece is a new Expenditure Arrears Clearance Strategy, a five-year plan to settle the US$1,3 billion in arrears using non-tradable securities and a reverse auction mechanism — a process Dhlamini admiringly calls “a piece of financial art”.
Concurrently, Treasury is seeking to restructure US dollar-denominated legacy debt, pushing maturities from 2025 to 2030 to free up immediate fiscal space.
On paper, this dual approach is a coherent attempt to clear past obligations while managing future liabilities.
The central flaw identified by analysts is not in the design of the plan, but in its foundational assumptions. The strategy is predicated on a halt to the very practices that created the crisis.
Dhlamini delivered the most pointed critique, estimating that “the success of this plan is less than 30% dependent on our financial models and more than 70% dependent on two external factors: the geopolitical goodwill of our external creditors and the unwavering, demonstrable political will within our own government to enforce fiscal discipline, even when it is painful”.
Without addressing the structural drivers — the over-contracting, off-budget spending, and weak commitment controls that Mutambasere highlighted — any clearance of old arrears will simply be followed by the rapid accumulation of new ones.
Dhlamini warned without this enforcement, Zimbabwe will remain trapped in a cycle of “arrears, new borrowing and repeated refinancing”.
Maketo raised a crucial democratic deficit. He warned that “transparency gains without deep participation, leaving citizens better informed, but still largely excluded from decision-making about who gets paid, who waits and what gets cut, is concerning”.
The technocratic plan risks being perceived as an imposition rather than a national compact.
This crisis sits within a longer history of fiscal mismanagement and external debt alienation dating back decades.
The current administration’s efforts to re-engage with international financial institutions and clear arrears with multi-lateral creditors form the essential backdrop to these domestic plans. Success internationally is inextricably linked to credibility at home.
The 2026 budget moment, therefore, presents a sheer crossroads. The government has laid out what Dhlamini terms “a strategy of breath-taking audacity”.
Its fate now hinges on a shift from technically proficient planning to politically courageous implementation.
It must demonstrate the will to curb the spending appetites of ministries, protect social spending from austerity and build inclusive oversight.
As Dhlamini indicated, the ultimate test is whether this plan becomes “a blueprint for a national renaissance, or a prelude to a more complex and painful reckoning”.