Zimbabwe's Economic Fundamentals Improve, Foreign Investment Flows Back In

Economic fundamentals in Zimbabwe are on the rise, with a new gold-backed local currency, the Zimbabwe Gold (ZiG), largely holding its value this year. The country's economic woes, including erratic policy, high inflation, and currency instability, have discouraged foreign investment for years. However, recent data suggests that foreign participation on the Zimbabwe Stock Exchange (ZSE) is increasing, with a significant jump in foreign trades and total market turnover.

Key Takeaways:

• Foreign participation on the ZSE rose to 26.53% in the second quarter, up from 15.39% in the previous quarter.
• Foreign trades jumped 153.94% to ZiG 743.6 million ($27.7 million) in the second quarter, compared to 292.8 million in Q1.
• Total market turnover on the ZSE increased 53.14% to ZiG 1.49 billion in the quarter.
• The total market value of the ZSE fell 3.08% to ZiG 62.64 billion, while the ZSE All Share Index declined 3.91% to 197.23 points.
• The top five companies contributed 86.19% of the equities turnover and 81.01% of the total market turnover for the period under review.
• Average foreign participation on the Victoria Falls Stock Exchange stood at 18.73% during the quarter.

Statistics:

• Foreign participation on the ZSE rose from 15.39% to 26.53% in the second quarter.
• Foreign trades increased by 153.94% to ZiG 743.6 million ($27.7 million) in the second quarter.
• Total market turnover on the ZSE increased by 53.14% to ZiG 1.49 billion in the quarter.
• 86.19% of equities turnover and 81.01% of total market turnover came from the top five companies.

Sources:

• "ZSE market data" (no date provided)
• International Monetary Fund (no date provided)