Business / Economy
New Cabinet will likely boost share prices
02 Sep 2013 at 21:29hrs | Views
SHARE prices on the Zimbabwe Stock Exchange will pick up once a new Cabinet has been named, Securities Commission of Zimbabwe chairperson Mrs Willia Bonyongwe has said.
Mrs Bonyongwe said the downslide on the local bourse was not peculiar to Zimbabwe, but a global phenomenon after an election.
She said this at a Press conference to announce SECZ's nomination for an award at the Africa Investor Institutional Investment Summit set for New York on September 24.
The ZSE plunged 11 percent in its second trading session after the July 31 harmonised elections in what some analysts said signalled negative post- election sentiment.
Other analysts were, however, of a different opinion saying the sell-off was triggered by a desire to take profits after almost 40 percent gain since January this year.
Mrs Bonyongwe, however, believes the fact that the opposition MDC-T contested the election result, claiming it was not free and fair, could have ruffled some investors.
The Constitutional Court has since ruled that the July 31 harmonised elections were free, fair and credible, paving way for President Mugabe's inauguration on August 22.
"When there is an election, people want to know what policies will come. The election result was contested. People want to know if it is Zanu-PF (led Government), what is it going to do and if it is MDC what it is going to do," she said.
Turbulence
Against this background, Mrs Bonyongwe said the turbulence on the stock market could continue until at least after President Mugabe has announced the incoming Cabinet.
The new Cabinet is expected soon, but only after swearing in today of Members of Parliament who triumphed in the harmonised elections resoundingly won by Zanu-PF.
The SECZ chairperson said good times will roll again for the ZSE, one of the best performing stock exchanges in Africa in the first half of 2013, because there is value in Zimbabwe.
"There is value in Zimbabwe and our companies. Most low profits are due to low capacity. Once we have addressed liquidity most will increase their volumes and profits."
Funding has been the single biggest constraint to economic recovery in Zimbabwe, although recovery growth topped levels in most of Africa between 2009 and 2011.
Liquidity has been tight due to the decade of economic contraction largely caused by illegal Western sanctions, which was compounded by rampaging inflation.
SECZ, however, believes that stimulating agricultural production and productivity through availing adequate funding will also be key to boosting industrial viability through increased demand when production creates latitude for creation of new jobs.
Mrs Bonyongwe said there were strong linkages between agriculture, manufacturing and mining, with the latter the primary bedrock for recovery in the other two.
Mrs Bonyongwe said the downslide on the local bourse was not peculiar to Zimbabwe, but a global phenomenon after an election.
She said this at a Press conference to announce SECZ's nomination for an award at the Africa Investor Institutional Investment Summit set for New York on September 24.
The ZSE plunged 11 percent in its second trading session after the July 31 harmonised elections in what some analysts said signalled negative post- election sentiment.
Other analysts were, however, of a different opinion saying the sell-off was triggered by a desire to take profits after almost 40 percent gain since January this year.
Mrs Bonyongwe, however, believes the fact that the opposition MDC-T contested the election result, claiming it was not free and fair, could have ruffled some investors.
The Constitutional Court has since ruled that the July 31 harmonised elections were free, fair and credible, paving way for President Mugabe's inauguration on August 22.
"When there is an election, people want to know what policies will come. The election result was contested. People want to know if it is Zanu-PF (led Government), what is it going to do and if it is MDC what it is going to do," she said.
Turbulence
Against this background, Mrs Bonyongwe said the turbulence on the stock market could continue until at least after President Mugabe has announced the incoming Cabinet.
The new Cabinet is expected soon, but only after swearing in today of Members of Parliament who triumphed in the harmonised elections resoundingly won by Zanu-PF.
The SECZ chairperson said good times will roll again for the ZSE, one of the best performing stock exchanges in Africa in the first half of 2013, because there is value in Zimbabwe.
"There is value in Zimbabwe and our companies. Most low profits are due to low capacity. Once we have addressed liquidity most will increase their volumes and profits."
Funding has been the single biggest constraint to economic recovery in Zimbabwe, although recovery growth topped levels in most of Africa between 2009 and 2011.
Liquidity has been tight due to the decade of economic contraction largely caused by illegal Western sanctions, which was compounded by rampaging inflation.
SECZ, however, believes that stimulating agricultural production and productivity through availing adequate funding will also be key to boosting industrial viability through increased demand when production creates latitude for creation of new jobs.
Mrs Bonyongwe said there were strong linkages between agriculture, manufacturing and mining, with the latter the primary bedrock for recovery in the other two.
Source - Chronicle
