The Victoria Falls Stock Exchange (VFEX) will soon embark on a global tour of marketing the bourse and the listed companies as part of efforts to lure foreign investors, 263Chat Business has learnt.
The VFEX is a foreign currency denominated exchange located in the resort city of Victoria Falls that has been tipped to become a regional offshore financial services center.
However, since its launch in October last year, the bourse is yet to register more than one company, with SeedCo being the sole entity listed to date.
Speaking at a virtual VFEX Mining Masterclass this morning, VFEX chief executive officer, Justin Bgoni said there were talks with government to go on a global tour to market the stock exchange.
“We want to market the Exchange. We are thinking of doing roadshows, going around the world and showcasing the stock exchange and the listed companies,” said Bgoni.
Bgoni said starting a stock exchange is an uphill task given the high risks associated with it hence the need for local investors and companies to lead the way in listings.
“We need participation of local investors. It’s difficult to attract foreign investors when local are not involved,”
“We are talking to quite a few potential listings. There are three types of people we are talking to< people who want to raise equity, people who want to raise debt on the market and people who want to raise commodities,” said Bgoni.
A number of incentives have been put in place to attract investors to the VFEX which includes zero capital gains tax and relatively lower listing fees among others.
Locally, the VFEX has set its eyes on the mining sector which is capital intensive and is reliant of the availability of foreign currency for its operations which is currently not readily available on the market.
Currently, miners are struggling to get adequate foreign currency to meet their needs and the situation has been worsened by the foreign currency export surrender requirements put in place by the Reserve Bank of Zimbabwe.
“There are capital challenges in the mining sector. The foreign exchange retention has reduced foreign currency availability for mining houses,” said Isaac Kwesu, chief executive of Chamber of Mines of Zimbabwe.
“The introduction of the VFEX will assist our members in the sense that it will ensure our mining houses will be able to get long term capital either as equity or in debt. There are a lot of projects that are on hold because of lack of capital for instance exploration financing which is very high risk, so it difficult to use regular income for that, it then requires capital from a stock exchange,” said Kwesu.