Export incentives to boost VFEX

Incremental export incentives announced by Government will encourage listing of exporters on the Victoria Falls Stock Exchange (VFEX), the bourse’s chief executive officer Justin Bgoni has said.

Last week, Finance and Economic Development Minister Mthuli Ncube revealed, through a press statement, incentives that are expected to encourage listing and participation of firms on the VFEX.

According to the press statement, exporters listed on the VFEX will retain 100 percent of their incremental export proceeds.

Currently all exporters are retaining just 60 percent and have expressed disgruntlement with that arrangement which they say is threatening viability.

Minister Ncube however says following “wide consultations with exporters and other various stakeholders” Government is putting in place export and investment incentives to promote economic growth by driving export growth, diversification and competitiveness.

Among other objectives, the incentives are meant “to encourage participation of firms on the Victoria Falls Stock Exchange.”

Since its launch in October last year, the VFEX only has one listed company, SeedCo International, although Mr Bgoni recently said he is happy with the pipeline of companies wanting to list.

The incentives will however come as a major encouragement to companies planning to list and those not yet convinced.

In agreement with the Government, Mr Bgoni said the incremental incentives significantly promotes the ease of doing export business and also encourages listing of exporters on VFEX.

“Such incentives are important as they attract new listings on the exchange and also promote economic growth,” he said.

Mr Bgoni said there are several exporters the bourse believe will benefit immensely from these incentives once they list on VFEX.

“We will continue with engagements to ensure their listing on VFEX.”

Mr Bgoni said in addition to the already announced tax and exchange control incentives, Government is sending a clear message about its commitment towards production, value addition, incremental growth and utilisation of local capital markets is being encouraged.

Some of the fiscal and non-fiscal incentives already approved by the Treasury include lower taxes ( 5 percent dividend withholding tax — for foreign investors only — and exemption from capital gains withholding) and reduced exchange control restrictions.

Mr Bgoni said the VFEX will this week hold a seminar to unpack these incentives to potential issuers.-herald.cl.zw