ZSE must play a leading role in Zimbabwe Economic recovery

The current effort to resuscitate Zimbabwe’s economy needs to involve more participants to include non-political entities and institutions which have expertise in mobilizing financial and other economic resources. One such Institution that can play a leading role in mobilizing recovery resources and investor interest is the Zimbabwe Stock Exchange ( ZSE) .

The ZSE can play a leading and prominent role in marketing Zimbabwe as a suitable and promising investment destination by attracting foreign and local investors who have an appetite for emerging market growth prospects.

Whilst the political leaders criss-cross the globe in search of AID, Donations ,grants and other forms of assistance the ZSE must be re-focused as a leading vehicle in attracting Foreign direct investment to Zimbabwe .The shares on the Zimbabwe Stock Exchange continue to out perform most other exchanges due to the fact the market may have been mis-priced after years of investor and capital flight.

The current transitional phase presents a unique opportunity for the ZSE to re-position Zimbabwe as a centre for various areas which Africa still lags behind. Many countries in Southern Africa have greatly benefited from the economic meltdown by attracting Zimbabwe’s skilled professionals especially from the banking and financial sector.

The ZSE can be pro-active is re-attracting these professionals by adopting clear and progressive listing requirements and linking up with other exchanges in being a modern and innovative financial centre. This in turn will attract banking and finance professionals who will obviously bring back a wealth of experience and vast network in credit and financial markets. This experience and networks will subsequently be a national treasure as it will serve to attract international capital into Zimbabwe’s economy.

This trend will quicken Zimbabwe’s re-integration into the global financial system which is critical for the economic recovery. It is clear aid and grants can no finance the economic recovery .This makes it imperative for private capital to be part of the recovery process and this should be mobilized through institutions such as the ZSE.

There are several areas that the ZSE can deliberately promote and encourage which will position Zimbabwe ahead of other countries on the continent. The Financial sector is one such area due to the well developed infrastructure and highly experienced and educated professionals.

The second area is the information ,communication and technology (ICT) sector which Africa is still lagging behind. This presents a clear opportunity Zimbabwe to brand itself the Silicon Valley of Africa, a title that is slowly being claimed by Rwanda. Zimbabwe has excellent infrastructure to build on a decent hub which can attract capital into the country. This can be channeled through the ZSE.

For this to happen the ZSE must actively and aggressively encourage Information, Communications and Technology companies to list .Econet and Celsys are already listed as Technology stocks which have over the years proven the value. Other companies from the sector such as Net-One ,Tel-One and Telecell should be given incentives and encouraged to broaden shareholding and raise expansion capital through a ZSE listing.

The planned listing of 3MG MEDIA Limited presents yet another opportunity to help position the ZSE as a forward looking, progressive and critical institution in encouraging capital mobilization and attracting investment. Africa has great potential in ICT and a clear market gap exist for an exchange that can position itself as the centre for African ICT capital raising activities. This will have multiple benefits and positive spin offs for the economy as jobs are created whilst service is enhanced.

Whilst the Global economy is in a tailspin Zimbabwe has to look at various ways to fund the recovery effort besides the traditional model of over-reliance on donors. Due to the current difficult credit market conditions this presents an opportunity to break with tradition and instead seek to finance the recovery exercise with Private capital and Foreign direct investment backed by investment from non-resident Zimbabweans who have built various support networks overseas.

The effort must be co-coordinated by a respectable body such as the ZSE which doesn’t suffer much from political ideology difference which is likely to affect any Government led effort to directly appeal for funds.

The ZSE is better placed to assist in that investors will do their own risk assessment and channel their funds in areas showing great potential. Instead of directly seeking funds the Government is better advised to focus more on creating a conducive and stable economic environment with protection of property rights and respect rule of law.

This will slowly attract investors whose goal is economic benefits whilst the Government gets its fair share in form of tax and other normal fees payable by business. As part of the Zimbabwe re-branding exercise it is important that Institutions such as the ZSE be at the forefront, with a clear theme such as encouraging ICT or particular service sectors which can anchor future growth.

Gilbert Muponda is an Entrepreneur based in Canada. He is CEO and Co-Founder of 3MG MEDIA Limited. He can be reached at;

Email: gilbert@gilbertmuponda.com Skype ID: gilbert.muponda

Phone: 1-416-841-5542