Victoria Falls Stock Exchange (VFEX) licensed as a Securities Exchange

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  • SECZ licenses the new VFEX
  • VFEX will operate as a  wholly-owned subsidiary of the Zimbabwe Stock Exchange (ZSE)
  • Fungible ZSE stocks expected to list on VFEX
  • Victoria Falls designated as a hub for tourism and financial services under the Special Economic Zones (SECZ)

The new Victoria Falls Stock Exchange Limited (VFEX) has been granted the license to operate a securities exchange by the regulator, the Securities and Exchange Commission of Zimbabwe (SECZ). The new market is expected to result in an inflow of hard currency to Zimbabwe, an economy embattled with forex shortages.

In a press statement issued on Tuesday, the CEO of the VFEX, Justin Bgoni gave details on the progress made with regards to the launch of the platform:

“VFEX is now finalising the listing and membership requirements, setting up of the trading and depository systems as well as modalities on the clearing and settlement of transactions. The completion of these processes, which is imminent, will enable VFEX to be launched.”

The development is the fruition of an earlier announcement by Zimbabwe’s Finance Minister Professor Mthuli Ncube in May of 2020 to open a stock exchange in the resort town of Victoria Falls. The Victoria Falls Stock Exchange will be denominated in foreign currency and aimed at “foreign investors and global capital, especially the mining sector,” Mthuli Ncube said.

The VFEX will operate as a  wholly-owned subsidiary of the Zimbabwe Stock Exchange (ZSE). To date, an aggregate 80 firms in the financial and capital markets have expressed interest to participate in the VFEX, the launch date of which is yet to be announced.

Victoria Falls has been selected as a hub for tourism and financial services under the Special Economic Zones (Sez) initiative aimed at attracting tourists as well as luring investment through tourism.

The move to launch the bourse has been accentuated by recent developments on the ZSE which led to a 5 weeks halt on trading activity. The government froze trading after what it termed as “observable speculating activity and carnage emanating from the implied exchange rate.”

The government has blamed the country’s largest financial institution, Old Mutual Limited, which has a secondary listing on the ZSE for influencing forex outflows through fungibility and also allowing for the computation of the Old Mutual Implied Rate. Both acts are however independent of the company’s influence.

In a bootstrapping move, authorities have proposed the delisting of all dual stocks (Old Mutual, PPC & SeedCo International) on the USD denominated VFEX from the ZSE main board and listing. 

The government’s interference with the markets has come in the way of local and international investor confidence as this was a 2008 de javu when the government froze trade on the ZSE for 8 weeks in the heat of a weakening Zim dollar and record inflation.

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