Zimbabwe Stock Exchange closed as government alleges 'conspiracy'

30 June 2020 - 13:26 By Sharon Mazingaizo
Zimbabweans queue outside a bank in Harare. Zimbabwe's annual inflation surged to 786% in May and the prices of basic goods increase weekly as the value of the Zimbabwe dollar tumbles. File photo.
Zimbabweans queue outside a bank in Harare. Zimbabwe's annual inflation surged to 786% in May and the prices of basic goods increase weekly as the value of the Zimbabwe dollar tumbles. File photo.
Image: REUTERS/Philimon Bulawayo

The Zimbabwe Stock Exchange (ZSE) has suspended trading after a government directive to halt trading activities.

The suspension threatens to further erode much-needed business and investor confidence in the country.

“While we await guidance from our regulators on the operational modalities going forward, we notify our stakeholders that trading has been suspended until further notice,” ZSE CEO Justin Bgoni said in a notice.

Government spokesperson Nick Mangwana on Friday announced the immediate suspension of trade on the exchange, as part of efforts to stop the slide of the Zimbabwe dollar.

“Government is in possession of impeccable intelligence which constitutes a prima facie case whereby the phone-based mobile money systems of Zimbabwe are conspiring, with the help of the Zimbabwe Stock Exchange, either deliberately or inadvertently, in illicit activities that are sabotaging the economy,” the government said in a statement.

The suspension of trade on the ZSE comes at a time when investor confidence is low in the country amid economic collapse. Kudzanai Sharara, a Harare-based independent financial analyst told TimesLIVE that the suspension would erode confidence.

“The ZSE acts as a window to the climate in the country and any arbitrary suspension of trade, without any substantial basis, will send a wrong signal about how capital markets operate in the country,” said Sharara.

Zimbabwe's annual inflation surged to 786% in May and prices of basic goods increase weekly as the value of the Zimbabwe dollar tumbles.

Economist John Robertson of Robertson Economics told TimesLIVE that the government was generating a hostile investment climate.

“Zimbabwe is in desperate need of development capital, for which it has to compete with the rest of the world. Zimbabwe had already placed itself close to the bottom of the list of contenders, with the government making the whole country less attractive by insisting that it be incorporated into every investment decision,” said Robertson.


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