Government spending and foreign debt are too high and it needs structural reform, Zimbabwe mission chief Gene Leon told Reuters news agency.

The country's incoming leader Emmerson Mnangagwa has pledged to grow the economy and provide "jobs, jobs, jobs".

The once-thriving economy is now seen as a regional basket case.

"The economic situation in Zimbabwe remains very difficult," Mr Leon told Reuters.

He said high government spending should be reined in and Zimbabwe should address the large international debt it has defaulted on.

"Immediate action is critical to reduce the deficit to a sustainable level, accelerate structural reforms, and re-engage with the international community to access much needed financial support," Mr Leon said.

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Robert Mugabe, who led Zimbabwe for 37 years, stepped down earlier this week under pressure from the military and his own Zanu-PF party.

His policies, including disastrous land reforms and printing too much money, are blamed for the calamitous state of Zimbabwe's economy.

On Thursday, Zimbabwe's main opposition called for deep-rooted political reform to dismantle the repressive apparatus that sustained Mr Mugabe's regime.

The Movement for Democratic Change (MDC) said it was cautiously optimistic that a Mnangagwa presidency would not "mimic and replicate the evil, corrupt, decadent and incompetent Mugabe regime", reported AFP news agency.

It is unclear whether Zanu-PF will govern alone ahead of scheduled elections next year, or whether a coalition government of national unity that includes opposition groups will be formed.

Economic slide

Zimbabwe's economy is half the size it was at the turn of the millennium.

Zimbabwe has not had a currency of its own since 2009, when the old Zimbabwean dollar buckled under hyperinflation - which is said to have reached 231 million per cent, worse even than the notorious levels in Germany following World War One.

Cash shortages mean Zimbabweans can often be seen queuing at banks. Economists say Zimbabwe needs a cash injection, but it has been barred from borrowing internationally since it began defaulting on its debt in 1999.

Some residents of the country's capital, Harare, say they have already seen an improvement in their daily lives since the army came into the streets and Mr Mugabe was forced from office.

One benefit, they say, is the absence of police road blocks on the streets where officers demanded bribes from those travelling around.

"There used to be so many police roadblocks, with the driver having to pay $1 or $2 (75p-£1.50)" Spiwe Azvigumi, 31, an unemployed mother of three, told AFP.

"With the police off the roads, crime is actually down - they were so corrupt and now we are living free."