Zimbabwe Stock Exchange electronic trading debut set for July – CE

Zimbabwe Stock Exchange electronic trading debut set for July – CE

By Bernard Mpofu, HARARE, June 3 (The Source) – Zimbabwe Stock Exchange’s automated trading platform is set to go live next month, a development which could see trades quadrupling, chief executive Alban Chirume said on Wednesday.

The local bourse, despite being one of the oldest in the region, has been lagging in automation, using the open outcry system which analysts say is slow, unwieldy and costly.

Chirume told a press briefing that the development of the country’s first ever automated trading system is nearing completion  after the ZSE signed a contract for the supply and installation of the Capizar Automated Trading System by Infotech Middle East FZ LLC in March last year.

“The major backbone of the hardware is complete. The software should be in place latest June 5 in terms of being loaded onto the servers,” Chirume said.

“From then on we are now talking about training of users, testing of the software and user acceptance of that software. All these I hope to have completed so that by the 3rd of July we go live.”

He said development of the interface between the Central Securities Depository and the ATS had taken time as companies took time to dematerialise their stocks.

“Critical to the success of the project is the on-boarding of the remaining counters onto the CSD…we are confident that the remaining nine counters will on-boarded prior to going live based on our interactions with the issuers,” he said.

“Our trades are very depressed at the moment and there is no doubt about that. Yes, there will there will an element of increase in terms of our trades. If you ask me is it going to be four times compared to where we started conceptualising this system.”

Turnover on the Zimbabwe Stock Exchange for the five months to May fell 40 percent to $122 million compared to the same period last year, according to official data, with analysts attributing the poor performance to weakening stock prices and anaemic economic fundamentals.

Zimbabwe’s Central Securities Depository firm last month said it would rely on moral suasion to convince the remaining nine of the 61 listed companies that are yet to switch to the electronic platform as the country’s equities market looks to complete its automation.

Gerald Katerere, risk and compliance manager at Chengetedzai Depository Company, said the firm has engaged the local bourse to persuade issuers of shares to dematerialize, saying legal gaps between laws governing business had resulted in the delays.

Early this year, the firm had set a March deadline to complete the process.