Published by the government of Zimbabwe
27 October 2009
Harare — THE Zimbabwe Stock Exchange has entered into a deal worth about US$1,2 million with a Sri Lankan Information Technology firm, Millennium IT Software Ltd to establish a Central Securities Depository.
ZSE chief executive Mr Emmanuel Munyukwi confirmed last week that the system would ensure a simultaneous transfer of shares from the seller to the buyer and transfer of money from the buyer to the seller.
Mr Munyukwi described the system as a facility for holding securities, which enables securities transactions to be processed by book entry.
The system may incorporate comparison, clearing and settlement functions.
The CSD therefore brings efficiency and convenience to both local and foreign investors by facilitating the transfer or pledge of securities without the need for physical movement of paper.
"We are finalising some few issues with MIT Software of Sri Lanka, but we are almost there (to seal the deal," said Mr Munyukwi.
MIT Software, recently acquired by the London Stock Exchange, installed the same systems at various exchanges including the Wall Street, Mauritius stock exchange, Botswana Stock Exchange and LuSE.
Meanwhile, Zimbabwe is set to benefit from systems that are being set up by central banks in Southern Africa that will ultimately result in a single payment and settlement system for the 15-state region.
According to SA Reserve Bank national payment system department head Mr Dave Mitchell said 12 of the 15 states had implemented gross real-time settlement systems, which meant that they had the means to conduct immediate electronic settlements.
Three countries had not achieved this level of service: the Seychelles, Madagascar and the DRC, where a largely unbanked population conducted mostly cash transactions.
Media reports from SA said Sadc was working to mirror the EU's economic integration model, which would include, ultimately, one central bank, one multinational payment and settlement system and one currency.
The cost of banking transactions were often abnormally high as a result of high banking fees, a multiplicity of banking regimes and foreign exchange fees imposed by the various countries.
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