The Industrial Development Corporation of Zimbabwe has plans to float a bond on the Econet Wireless platform as a way of raising money from the public.
Victoria Mtomba,Business Reporter
Speaking before the Parliamentary portfolio Committee on Industry and Commerce, IDC general manager Michael Ndudzo said the company required funds to do its job of lending money to the public. He said for the past 22 years, the company has not received funds from Treasury but relied on its investments.
“We have approached Econet so that we can use their EcoCash platform. We are still trying to pursue them. We are keen to use their platform,” he said.
A bond is a debt instrument issued for a period of more than one year with the purpose of raising capital by borrowing. He said bonds can help in this market where short-term funds are available as they will be structured over long periods.
Ndudzo said in 2012 the corporation raised $13,5 million through CBZ as a diaspora bond and the money was used for the upgrade of Surface Investments.
He said the corporation, during the Zimbabwean dollar era, floated a bond with Intermarket that was oversubscribed. The Infrastructure Development Bank has said it would float $60 million bond this year while a $30 million bond that they floated in 2012 was undersubscribed.
Ndudzo said work in progress for the corporation has been stalled due to low domestic savings and country risk, affecting appetite from foreign direct investors, and the need in most cases for reinvestment to upgrade plant and equipment.
“Major perceived and real policy impediments have been on indigenisation thresholds, immigration of skilled staff, retrenchment costs and regulations and property rights,” he said.
Ndudzo said close to 78 investors have reversed deals when they wanted to seal a deal with Olivine Industries, a subsidiary of the corporation. He, ho wever, said the corporation was engaging in talks with a multibillion investor.
IDCZ subsidiaries include Almin Metal Industries, Amtec, Sunway city, Allied Insurance, Zimbabwe Copper Industries, Deven Engineering, Willowvale Mazda Motor Industries, Sable Chemicals, Zimphos, Dorowa Mineral and others.