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Business Reporter
The Zimbabwe Stock Exchange is at an advanced stage in preparations for the listing of debt instruments on the bourse which will offer the market a wider array of tradable securities beyond just shares and debentures. As part of the preparations for the launch of the listing of debt instruments, the ZSE will host a Debt Market seminar on September 9 where the modalities of the revived debt market will be shared.

“The seminar will be of much benefit to the entire capital markets as the aim is to demonstrate how the debt market works in the current environment and also learn from regional exchanges on how the debt market was implemented in their countries,” he said. In written responses to The Herald Business, chief executive officer Mr Alban Chirume said over the past two years, the ZSE has been consulting stakeholders on the various facets of the market.

“The ZSE is at an advanced stage in terms of preparations for the listing of debt instruments, Government Debt Instruments included. There are specific requirements that all issuers must comply with and the Government Debt Instruments are not an exception,” said Mr Chirume. In particular, the ZSE has enhanced the listings requirements to provide more detail in terms of the rules pertaining to the listing of debt instruments.

Mr Chirume said consultations with stakeholders for setting of favourable charges for trading in Government debt instruments are ongoing. “In addition, the ZSE has noted that while it’s current platform allows it to list and allow trading in debt instruments, the charges are prohibitive and thus rendering the market unattractive to investors,” said Mr Chirume.

In the Mid Term Policy review statement Finance and Economic Development Minister Patrick Chinamasa proposed that all Government and parastatals bonds be listed on the ZSE. Minister Chinamasa said the debt market is an ideal platform for Government to source long term funding for infrastructural projects.

Stakeholders said the proposed listing of Government securities could increase the scope of the ZSE as the bourse will have a wider array of tradable securities beyond just shares and debentures. “Bonds will be an additional product on the ZSE, meaning investors, who meet a certain criteria, instead of trading in shares alone, the market can now trade in bonds- another investment avenue.

‘‘Basically, its more options to investors and more tradable products for traders,” said Mr Kundai Msemburi, Head of Corporate Finance and Market Development at the Securities Commission of Zimbabwe. Currently, Government securities are traded in what is called the Over the Counter market that is operational in the interbank market as well as the non bank financial market.