Victoria Falls — Finance Minister Mthuli Ncube has launched the Victoria Falls Stock Exchange (VFEX) here which will kick start the operationalisation of the Victoria Falls Special Economic Zone (SEZ).
However, only one company, SeedCo International, a seed processing company, was the only company that listed with trading expected to begin Monday.
Ncube who was the guest speaker said VFEX will be a platform for companies in Zimbabwe, the SADC sub-Saharan Africa to raise capital in foreign currency and help investors to trade in the secondary market in hard currency.
The government designated the resort town of Victoria Falls a hub for tourism and financial services under the SEZ initiative to attract tourists and investment through tourism.
The VFEX is a wholly-owned subsidiary of the Zimbabwe Stock Exchange (ZSE) and will trade solely in foreign currency targeting mining companies in Zimbabwe and the Africa continent, before expanding across the globe.
Trading only in foreign currency is expected to help reduce settlement risks in troubled Zimbabwe.
“The establishment of this exchange today marks the beginning in earnest of our journey towards the establishment of an offshore financial services centre in Victoria Falls,” Ncube said.
“The move will go down as the laying of the foundation stone of the offshore financial service centre and is a key pillar supporting efforts to grow Victoria Falls’ status as not just a special economic zone but an offshore financial hub. The launch of VFEX will therefore kick start the Victoria Falls Special Economic Zone, ” said Ncube.
He said the VFEX would be a game-changer in the trading of securities in the country as well as a conduit for portfolio investments and foreign direct investment in the rest of Africa in hard currency.
“This will reduce foreign currency and settlement risk for our international investors. The launch of VFEX will also deal with the exchange rate risk from portfolio investment into the country.
“As the Government of Zimbabwe, we saw an opportunity to work with the ZSE in creating a global platform for the trading of stocks in foreign currency, and to do it in a way that promotes foreign investment into Zimbabwe and the region,” said Ncube.
He called on other counters listed on ZSE to have a listing on VFEX to enable them to also obtain funding to retool and expand their operations.
The minister added VFEX is one of the strategic initiatives being implemented by the government to stabilise the economy and attract foreign direct investment towards vision 2030.
The Treasury head said investors on the VFEX platform will benefit from several fiscal and non-fiscal incentives that have been approved by the Treasury.
“The tax incentives will significantly create confidence in the operation of the offshore financing center and attract capital from across the globe,” said Ncube.