Zimbabwe Stock Exchange
Encyclopedia
The Zimbabwe Stock Exchange, or ZSE, is the official stock exchange
of Zimbabwe
. It has been open to foreign investment
since 1993. The exchange has about a dozen members and over 65 listed securities. There are two indices, the Zimbabwe Industrial Index
and the Zimbabwe Mining Index.
opened its doors shortly after the arrival of the Pioneer Column
in Bulawayo
in 1896. However, it only operated for about six years. Other stock exchanges were established in Gwelo (Gweru
) and Umtali (Mutare
). The Mutare Exchange, also opened in 1896, thrived on the success of local mining
, but with the realisation that deposits in the area were not extensive, activity declined and it closed in 1924. After World War II
a new exchange was founded in Bulawayo
by Alfred Mulock Bentley
and dealing started in January 1946.
A second floor was opened in Salisbury (Harare
) in December 1951 and trading between the two centres took place by telephone
. Traders continued working by telephone until it was decided that legislation should be enacted to govern the rights and obligations of the members of the exchange and the general investing public.
The Rhodesia Stock Exchange Act reached the statute book in January 1974. The members of the exchange continued to trade as before and for legal reasons it became necessary to create a new exchange coincidental with the passing of the legislation. The exchange dates from the passing of the act in 1974, and is operated and regulated in accordance with the act and its amendments, including 1996's Zimbabwe Stock Exchange Act: Chapter 24:18.
On achieving independence from Britain
in 1980, the exchange changed its name from the Rhodesia to the Zimbabwe Stock Exchange.
With the decline of the Zimbabwean economy, hyperinflation rendered the Zimbabwean dollar useless and the US-Dollar was adopted as the legal tender for trading on the exchange in February 2009.
As of March 2009, trade has been very thin, with very few foreign investors willing to risk trading on the market. Most stocks trade in the US-cent range, with at least 26 different stocks not trading at all.
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
of Zimbabwe
Zimbabwe
Zimbabwe is a landlocked country located in the southern part of the African continent, between the Zambezi and Limpopo rivers. It is bordered by South Africa to the south, Botswana to the southwest, Zambia and a tip of Namibia to the northwest and Mozambique to the east. Zimbabwe has three...
. It has been open to foreign investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
since 1993. The exchange has about a dozen members and over 65 listed securities. There are two indices, the Zimbabwe Industrial Index
Zimbabwe Industrial Index
The Zimbabwe Industrial Index is a stock index derived from the values of industrial stocks on the Zimbabwe Stock Exchange. The Zimbabwe Mining Index is a separate stock index, composed of mining companies.-Index listing:-Zimbabwe Mining Index:...
and the Zimbabwe Mining Index.
History
The first stock exchange in ZimbabweZimbabwe
Zimbabwe is a landlocked country located in the southern part of the African continent, between the Zambezi and Limpopo rivers. It is bordered by South Africa to the south, Botswana to the southwest, Zambia and a tip of Namibia to the northwest and Mozambique to the east. Zimbabwe has three...
opened its doors shortly after the arrival of the Pioneer Column
Pioneer Column
The Pioneer Column was a force raised by Cecil Rhodes and his British South Africa Company in 1890 and used in his efforts to annex the territory of Mashonaland, later part of Southern Rhodesia ....
in Bulawayo
Bulawayo
Bulawayo is the second largest city in Zimbabwe after the capital Harare, with an estimated population in 2010 of 2,000,000. It is located in Matabeleland, 439 km southwest of Harare, and is now treated as a separate provincial area from Matabeleland...
in 1896. However, it only operated for about six years. Other stock exchanges were established in Gwelo (Gweru
Gweru
Gweru is a city near the centre of Zimbabwe at . It has a population of about 146,073 , making it the third largest city in the nation. Gweru is the capital of Midlands Province. Gweru was founded in 1894 by Dr. Leander Starr Jameson. The first bank opened in Gweru in 1896, and the stock exchange...
) and Umtali (Mutare
Mutare
Mutare is the fourth largest city in Zimbabwe, with a population of around 170,000. It is the capital of Manicaland province.-History:...
). The Mutare Exchange, also opened in 1896, thrived on the success of local mining
Mining
Mining is the extraction of valuable minerals or other geological materials from the earth, from an ore body, vein or seam. The term also includes the removal of soil. Materials recovered by mining include base metals, precious metals, iron, uranium, coal, diamonds, limestone, oil shale, rock...
, but with the realisation that deposits in the area were not extensive, activity declined and it closed in 1924. After World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
a new exchange was founded in Bulawayo
Bulawayo
Bulawayo is the second largest city in Zimbabwe after the capital Harare, with an estimated population in 2010 of 2,000,000. It is located in Matabeleland, 439 km southwest of Harare, and is now treated as a separate provincial area from Matabeleland...
by Alfred Mulock Bentley
Alfred Mulock Bentley
Alfred Mulock Bentley was a British-born financier who founded the Rhodesian Stock Exchange in Bulawayo in 1946....
and dealing started in January 1946.
A second floor was opened in Salisbury (Harare
Harare
Harare before 1982 known as Salisbury) is the largest city and capital of Zimbabwe. It has an estimated population of 1,600,000, with 2,800,000 in its metropolitan area . Administratively, Harare is an independent city equivalent to a province. It is Zimbabwe's largest city and its...
) in December 1951 and trading between the two centres took place by telephone
Telephone
The telephone , colloquially referred to as a phone, is a telecommunications device that transmits and receives sounds, usually the human voice. Telephones are a point-to-point communication system whose most basic function is to allow two people separated by large distances to talk to each other...
. Traders continued working by telephone until it was decided that legislation should be enacted to govern the rights and obligations of the members of the exchange and the general investing public.
The Rhodesia Stock Exchange Act reached the statute book in January 1974. The members of the exchange continued to trade as before and for legal reasons it became necessary to create a new exchange coincidental with the passing of the legislation. The exchange dates from the passing of the act in 1974, and is operated and regulated in accordance with the act and its amendments, including 1996's Zimbabwe Stock Exchange Act: Chapter 24:18.
On achieving independence from Britain
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
in 1980, the exchange changed its name from the Rhodesia to the Zimbabwe Stock Exchange.
With the decline of the Zimbabwean economy, hyperinflation rendered the Zimbabwean dollar useless and the US-Dollar was adopted as the legal tender for trading on the exchange in February 2009.
As of March 2009, trade has been very thin, with very few foreign investors willing to risk trading on the market. Most stocks trade in the US-cent range, with at least 26 different stocks not trading at all.
See also
- Economy of ZimbabweEconomy of ZimbabweThe economy of Zimbabwe has shrunk significantly after 2000, resulting in a desperate situation for the country and widespread poverty from among others 94% unemployment. The participation from 1998 to 2002 in the war in the Democratic Republic of the Congo set the stage for this deterioration by...
- List of stock exchanges
- List of African stock exchanges
- Zimbabwe Industrial IndexZimbabwe Industrial IndexThe Zimbabwe Industrial Index is a stock index derived from the values of industrial stocks on the Zimbabwe Stock Exchange. The Zimbabwe Mining Index is a separate stock index, composed of mining companies.-Index listing:-Zimbabwe Mining Index:...
- Zimbabwe Mining Index