Confidence in listing on VFEX grows
The Government is encouraged by the growing confidence in the Victoria Falls Stock
Exchange (VFEX), which has manifested through several new listings, a development
expected to stimulate investment into the country and accelerate economic growth.
VFEX, launched in October 202,0 is a subsidiary of the Zimbabwe Stock Exchange (ZSE)
established to kick start the Offshore Financial Services Centre (OFSC) earmarked for the
special economic zone in Victoria Falls.
The US dollar-denominated stock exchange has been offering various incentives that
include Government’s increase in the retention ratio for exporters listed on the VFEX to
100 percent which has been an attractive factor for companies.
Listing on the VFEX also facilitates raising of US dollar capital, which enhances the
potential for organic growth and inorganically.
Industry and Commerce Minister Dr Sekai Nzenza said at the VFEX listing ceremony for
National Foods Limited last Friday that VFEX will allow companies to mobilise resources
to invest in capacity and value chains in line with aspirations of National Development
Strategy 1 (NDS1).
“We hope to see more companies coming on board on VFEX. We are encouraged by the
increased confidence that continues to grow on the VFEX, it is remarkable to start the
year with a new listing,” she said.
Now three years old, VFEX has a total of eight listings and different securities that
include equities, Zimbabwe Depository receipts and fixed incomes.
Dr Nzenza said National Foods was among companies investing through the value chain
and moving the economy up the value chain.
“We are seeing value addition in the portfolio of basic food commodities. In NDS1, we
talk of import substitution, National Foods has been supporting local production, the
Buy Zimbabwe initiative and accessibility to basic commodities,” she said.
The industry minister said the company had committed investments across its business
portfolios that include the flour mill in Bulawayo, pasture and rice plants in Harare as
well as the stockfeeds plant.
“This will result in the production of 190 000 tonnes of cereals per annum, generating
revenue in the region of uS$300 million to US$400 million and creating 1 000 direct jobs,
in addition to already existing 1500 employees,” said Dr Nzenza.
She noted that National Foods had also embraced technology, which will result in import
substitution and contribute to the US$8 billion industry and commercial sector by 2023.
“The company is investing in securing food security through the latest technology which
improves production,” she said.
Finance and Economic Development Deputy Minister Clemence Chiduwa said new
listings signified the positive developments in the productive sectors of the economy.
He said the Ministry of Finance and Economic Development was always encouraged when
the development trajectory of the country is in sync with the NDS1 policy.
“Value addition, moving the economy up the value chain, localising production in line
with NDS1. As long as you align with NDS1, that will automatically feed into the Vision
2030,”said.
He noted that the successful implementation of NDS1 rode on improved manufacturing
sector through value addition and Natfoods through their investments and product
diversification has been doing that.
“If we are to attain growth, it will be private sector led, while the Government focuses on
accelerating policy and improving the business environment.”
Mr Chiduwa said Government reaffirms support for VFEX in order to make it a preferred
destination for investors and companies.
He said the current rules and regulations on the VFEX go a long way in making the
market irresistible to foreign capital and looks forward to more listings on the VFEX this
year.
Deputy Minister of Lands, Agriculture, Water, Climate and Rural Resettlement Vangelis
Haritatos said National Foods investments are a testament to an enabling environment
being ushered by the Second Republic.
He said National Foods is an active player in the agriculture sector through supporting
local farmers through contract farming and offtake agreements.
“The country produced record wheat production last year and this was supported by
companies such as National Foods and partners. Through the offtake agreements,
companies are required to fund 40 percent of their raw material requirements and
National Foods is doing that,” he said.
National Food acting chairman Mr Godfrey Gwainda said the group remained positive on
the growth and outlook of the economy and continues to make significant investments in
different categories.
He said in line with import substitution and NDS1, the company will invest in a new
pasture line in Harare, and this will be a first line in Zimbabwe which will offer
customer’s wider options.
In addition to that, the company is also investing in the biscuit plant in Harare which will
produce a wide range of biscuits, to widen choices Aspindale stock feed plant improve
production efficiencies and supply.
“Many of the investments will localise most products that were being imported. The
increase in capacity will result in increased support to our local farmers,” he said.
He said the move to list on VFEX will unlock shareholder value and capitalise through
easier access to regional opportunities in the long term.
VFEX chairperson Mrs Caroline Sandura said the year 2023 will be one of the best years
for VFEX in terms of new listings and product diversification.
She said the bourse continues to receive support from Government and regulator Seczim
in ensuring efficient listings.
“As VFEX, we are diversifying products such as real estate investment trusts (REITs),
Exchange Traded Funds (ETF) and contract for different (CFD) and companies who seek
to raise capital through initial public offering (IPOs) should utilise VFEX,” she said.-The Herald
