Finance Minister to lead Vic Falls Stock Exchange opening

FINANCE and Economic Development Minister, Professor Mthuli Ncube, will officially open the Victoria Falls Stock Exchange (VFEX) in the resort town on Friday with 17 securities firms and 13 sponsors having registered to participate on the platform.

VFEX has already occupied its new offices in the resort town ahead of opening and by yesterday, partitioning of offices had been completed as well as outside signage, air-conditioning and furnishing inside.

The Friday event will mark the launch and commencement of trading of United States-dollar denominated securities on the new stock market, which will help the country lure the much-needed offshore investment. The move follows the approval by the Securities and Exchange Commission of Zimbabwe (SECZ). The new bourse has also signed a memorandum of understanding with the Reserve Bank of Zimbabwe guaranteeing smooth trade settlement with investors. VFEX will be operated by the Zimbabwe Stock Exchange (ZSE) and is expected to play a key role in easing perceived risk of Zimbabwe as an investment destination.

“The Minister of Finance and Economic Development, Professor Mthuli Ncube, will be the guest of honour. Trading, depository services, clearing and settlement on VFEX will commence on Monday,” ZSE chief executive officer, Mr Justin Bgoni, said.

Registered service providers on the exchange at the moment include 17 securities firms, 13 sponsors, seven asset managers and three transfer secretaries. Zimbabwe will be aiming to attract global capital mostly from the mining sector when the VFEX comes into operation this week.

VFEX will allow listed companies to raise and trade their stock in any convertible hard currency, limiting the exchange risk.

According to Minister Ncube there is a need for the creation of globally recognised stock exchanges in Africa, those that arise from environments that are devoid of any negative impact of exchange rate fluctuations.

The Victoria Falls Special Economic Zone has created an opportunity for the setting up of the VFEX as a first step towards establishment of an offshore global financial services centre in the resort town.

The Government is already in talks with several international investment banks to support the VFEX while a number of companies have expressed interest listing with the new market. In a recent interview with local radio station Breeze FM Mr Bgoni challenged the tourism industry to see value in the new stock market.

“We are doing this for the development of the country. We know that for the country to do well it needs foreign investment and this is the platform that we hope will bring foreign investors to the country. There is less risk because it’s in United States dollars and again it will be easy and cheaper to move money in and out,” he said.

Government has committed that the VFEX will remain a foreign exchange market in line with Vision 2030, which requires a lot of foreign investment.

The country needs a vehicle that will make it attractive to foreign investors hence the VFEX which has tax benefits.

The country generates slightly above US$4 billion foreign currency per month, which is shared among various economic sectors.

Mr Bgoni said it will be easy for foreigners to invest in the VFEX and also urged local tourism and hospitality industry to list.-chronicle.co.zw