14 February 2013

Southern Africa: Regional Exchanges Meet

OFFICIALS from various Sadc stock exchanges converge on Victoria Falls today for a two-day Committee of the Sadc Stock Exchanges meeting aimed at sharing information for the betterment of stock markets in the region.

The meeting is being hosted by the Zimbabwe Stock Exchange and is the first of three such meetings scheduled to be held by the committee in different regional countries this year.

ZSE operations executive Mr Martin Matanda last week said Finance Minister Tendai Biti would be the guest of honour at the regional stock exchanges meeting starting today.

"Zimbabwe Stock Exchange is hosting this regional stock exchange . . . CoSSE is a regional group of stock exchanges trying to help each other by talking about common issues and recommending solutions," Mr Matanda told Herald Business in an interview last week.

The meeting would be looking at capacity building, investor education, strategies to improve the markets visibility, markets developments and new products, harmonisation of listing requirements, application of new technology in improving areas of depositories and enhancing access to markets..

He said the ZSE would take the opportunity of the meeting to introduce Chengetedzai Depository Company to the committee, which is in the process of setting up the country's first ever paperless trading and securities settlement system in line with global trends.

The Victoria Falls meeting is being attended by stock exchange officials from Botswana, Lesotho, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe.

Stockbrocking firms attending the meeting also have an opportunity to get an insight into regional trends. Committee of Sadc Stock Exchange meetings are held three times a year and the next such meeting would be in Mauritius.

Zimbabwe, said Mr Matanda, is hosting the regional event for the first time in more than a decade.

Zimbabwe, like many other regional stock exchanges, is in the process of modernising its trading systems and has set out to introduce a central securities depository (CSD).

The meeting would provide insights into how other regional stock exchanges have done it.

Apart from establishing a CSD, the ZSE is also in the process of demutualising the bourse to make it a private entity in which Government becomes the biggest shareholder as opposed to a membership-based entity run by stockbrokers.

Demutualisation is process of transforming a member-based society or club into a company that has shareholders and has a strong profit orientation.

Minister Biti last year said demutualisation was critical to prevent cartels of members from dictating the affairs of the bourse, which created credibility crises. Once the bourse lacks confidence it would struggle to attract investors.

As such, the CSD will improve liquidity, promote market integrity and transparency while minimising market manipulation, fraud and financial crime.

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