Govt, banks in talks over new stock exchange 

Source: Govt, banks in talks over new stock exchange | eBusiness Weekly

Govt, banks in talks over new stock exchange
Justin Bgoni

Zimbabwean authorities are in discussions with several international investment banks to support a new stock exchange that will trade exclusively in foreign currency, Finance Minister Mthuli Ncube said.

“The interest has been huge,” Ncube told an analyst briefing.

He declined to give further details.

Yvonne Mhango, sub-Saharan Africa economist at Renaissance Capital, told the briefing that uppermost on foreign investors’ minds was the ability to repatriate their capital.

“What they want is a functioning stock exchange,” Mhango said.

The global lenders would handle clearing and settlement of trades, thereby guaranteeing investors’ funds, Zimbabwe Stock Exchange chief executive officer Justin Bgoni said at the event. The companies involved in talks are based in Africa, Asia and Europe, he said.

The exchange, to be known as VFEX and based in the resort town of Victoria Falls, will open in “a couple of weeks,” said Bgoni, who will head the bourse.

Meanwhile Minister Ncube said launch of the Victoria Falls Stock Exchange (VFEX) is meant to deal with exchange rate risk from portfolio investment into the country.

Calling the establishment of the new exchange a “solution rather than a problem” Minister Ncube said it was part of efforts to deal with the “environment for doing business” in the country.

Apart from being a conduit of portfolio investments and foreign direct investment into Zimbabwe, the long term ambition is to make it a platform of trading securities in Africa in hard currency, according to Minister Ncube.

As part of the global picture, the VFEX is expected to offer pension funds an opportunity to invest in foreign securities.

“As a Government working with the Zimbabwe Stock Exchange (ZSE), we saw an opportunity to perhaps create that Pan-African if not global platform for the trading of stocks on the African continent.

“We want to do it in a way that it is promotive of foreign investment into Zimbabwe and the region,” Minister Ncube said.

The VFEX, he said, will be a driver of investments into the mining sector and insurance companies that offer services to the mining sector and other sectors that desire US$ insurance products.  Business Writer/Bloomberg.

 

COMMENTS

WORDPRESS: 2
  • comment-avatar
    Ndebele 1 month ago

    How will you keep those thieving Zanu fingers off it though? Nothing is safe from Zanu thieving fingers if one looks at the last 40 years Zimbabwe has been blessed with world rated kleptomaniacs from the Zanu School of Kleprocracy. It knows no bounds in terms of race, colour or creed – just have to be Zanu royalty with a desire to steal.

  • comment-avatar
    Dr Ace Mukadota PhD 1 month ago

    This is a silly idea comrades. The ZSE itself is shrinking as foreign investors are lured into buying ZW shares and then unable to sell and take money out of country. You cant open a restaurant in Harare & get customers into the place but deny them the option to leave after they have had their meal.
    ZW comedy show rolls on and on – why would anyone invest in USD in ZW just because Comrade Justin Bgoni of the ZSE has set up a new shop at Vic Falls.
    Perhaps New York Stock Exchange & Johannesburg Stock Exchange will come and set up in opposition as well. Maybe even Hong Kong Stock exchange will relocate to Vic Falls as too much trouble in HK these days with CCP moving the goal posts.
    Its time Comrade Doctor Philip Chiyangwa PHD listed his ZECO on the Vic Falls exchange – there will be a rush to invest in this ZW blue chip !
    Chokwadi