THE Zimbabwe Stock Exchange (ZSE) is planning to set up a secondary exchange for small-to-medium enterprises (SMEs) in a bid to raise capital for one of the country’s fastest-growing sectors, an official has said. Report by Bernard Mpofu Chief Business Reporter
According to a statement released by ZSE interim board chairperson Eve Gadzikwa, work was currently underway to create a platform for undercapitalised small enterprises to start trading on the local bourse. She said the decision by the SMEs to go public would unlock potential and help shareholders in spreading risk.
“The market is a viable alternative to raise funding. Focus now is to look at how the capital markets can be opened to assist SMEs through the creation of an SME bourse,” Gadzikwa said.
“The creation of an SME bourse is a positive development and the next step for the ZSE in particular and the country as whole as the exchange looks to inclusive business involving SMEs.
“Although the mechanics of the whole structute are still in skeletal form, ZSE will share what outlines of the bourse are proposed to be. The ZSE is aware of the increasing role of SMEs in other emerging markets as witnessed by the creation of SME boards in other African stock exchanges.
“The SME funding requirements is a delicate matter that needs to be constantly on our radar.”
It is estimated that over 60% of the economy is informalised.
The listing of SMEs under the proposed plan, according to Gadzikwa, will result in the creation of two ZSE boards.
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“The SME exchange will have its own listing rules. The ZSE is looking at drafting rules that are tailored to the SMEs in consultation with various stakeholders, including the SME Association.
“Concessions may be made in areas such as the minimum number of shareholders and profitability history, but these have to be approved by the ZSE and the Securities Commission of Zimbabwe in consultation with the SME Association,” she added.
