More counters to list on VFEX: Bgoni

RYAN CHIGOCHE

 

The Victoria Falls Stock Exchange (VFEX) is expecting more counters to list on the foreign currency denominated bourse before year-end on the back of incentives to drive more listings, an executive has said.

VFEX is a subsidiary of the Zimbabwe Stock Exchange (ZSE) established last year to kick-start the Offshore Financial Services Centre earmarked for the special economic zone in Victoria Falls.

It has two counters — Seed Co International and Padenga — as it approaches its first anniversary with analysts saying the bourse has been struggling to attract new listings due to confidence deficit despite offering lucrative incentives to potential investors.

Justin Bgoni, the CEO of ZSE is, however, confident VFEX would add more listings before year-end.

“There are several companies both local and foreign that have expressed interest in listing on VFEX, and we have been engaging the potential issuers.

With the current incentives available on VFEX, we certainly anticipate to get more listings before year end,” Bgoni told Business Times this week.

Caledonia and CBZ Holdings are some of the local entities that promised to list on VFEX.

Bgoni said having two counters in the first year was actually a feat worth celebrating as capital market projects were long term.

“Capital markets are long-term projects and we actually celebrate having two counters listed over the past 9 months.

“Listing on an exchange remains a voluntary exercise and our efforts have been to ensure that there are sufficient incentives to attract listings,” he said.

“We appreciate the support from the Government in ensuring that exporters who list on VFEX will be able to retain up to 100% of the incremental export revenue earned and that the exchange is competitive in terms of low transactional costs. Our focus is to grow the listings and we are positive that we will add to the current listings before the year-end.’’

The VFEX has been running campaigns and advertisements in an effort to attract more counters on the platform.

But, it has failed to achieve the objective.

In April, VFEX announced plans to allow small-scale mining to register on the bourse as a way to increase its product range.

A number of questions have been raised on the attractiveness of the exchange to both issuers and investors, bearing in mind the limited trading activity on the bourse.

The VFEX operates independently, using a set of rules of trading that are different from the mainland zone.

Securities listed on the VFEX are tradable and settled solely in United States Dollars or a convertible currency.

Companies trading on the VFEX can easily remit dividends to their shareholders unlike on ZSE but still many investors have adopted a wait and see attitude as they are all hesitant to invest.

There has been reported interest from several international investment banks to support the VFEX but nothing has ever come to fruition.

 

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