IN the face of weakening economic fundamentals in Zimbabwe, the Zimbabwe Stock Exchange (ZSE) has proved a safe haven for investors with the ZSE All Share Index surging 1046% in 2020. This has been carried over into 2021 as the local bourse sustained rallying momentum in the first week of February along with global shares, as the ZSE All Share Index edged 11,43% to close at an all-time-high of 4012,47 points. In 2021 so far, the market is up by over 55%, thanks to the second best January performance in a decade.
However, the past 24 months have seen no brand new listings of companies and an increase in the number of delistings. The pressures of Covid-19, the contraction of the economy by 4,1% in 2020, government interference with capital markets, high listing costs and a poor operating environment are some of the reasons ZSE listed firms have sought delisting. Furthermore, local companies have been pushed into amalgamations, unbundling and the pursuit of listings on alternative mark
SHAME MAKOSHORI
The ZSE’s fungible titans were among the casualties of a terrifying crackdown on business by authorities, which dampened investor confidence and wiped $240 billion in potential revenue.
But the brief closure in June only amplified an already difficult crisis for the bourse.
Many firms had already embarked on plans to de-list and go private, saying it was no longer viable to maintain a listing.
Again, that was bad for a stock market that had been hit by a listing drought stretching over a decade, which triggered questions about the relevance of the ZSE in a rapidly shifting market place.