Nelson Gahadza, Harare Bureau
The Victoria Falls Stock Exchange (VFEX) turnover grew by 117 percent to US$58,51 million in the first quarter of 2025 (Q1 2025), with market activity high on the back of increased demand for haven and special negotiated trades.
VFEX is a subsidiary of the Zimbabwe Stock Exchange (ZSE), established to kick-start the operationalisation of the Offshore Financial Services Centre (OFSC) as an integral element of the Victoria Falls Special Economic Zone.
The US dollar-denominated exchange has attracted several listings, with the bulk of them migrating from the ZSE, largely due to the many incentives the exchange offers and provisions for companies to raise capital in foreign currency.
According to the Securities and Exchange Commission of Zimbabwe (SecZim) capital market newsletter Issue 2 of 2025, the ZSE turnover for the first quarter of this year, at ZiG 951 million, translates to US$35,80 million, representing a six percent decline from the last quarter of 2024, as trading activity remained subdued.
“Subdued trading activity on the ZSE saw total market capitalisation resultantly losing 5,63 percent from US$3,87 billion in Q4 2024 to close Q1 2025 at US$3,65 billion,” reads part of the report.
Analysts believe Zimbabwe’s capital markets have undergone significant transformation. Both the ZSE and VFEX witnessed unique trajectories, influenced by local and international events.
The ZSE has shown resilience amidst global and domestic economic headwinds, while the VFEX’s stability has attracted domestic and foreign investors, although overall liquidity has remained the same.
According to the SecZim newsletter, the VFEX All Share Index registered a quarterly growth of 5,99 percent from 104,09 points as at December 31, 2024, to close at 110,32 points on March 31, 2025.
The ZSE All Share index registered a quarterly drop of 5,67 percent to close at 205,25 points by March 31, 2025, from 217,58 percent as at the end of December 2024.
During the quarter under review, total funds under management (FUM) stood at ZiG93,35 billion, representing a 3,55 percent increase from ZiG90,35 billion recorded in the previous quarter.
The report shows that total FUM as at the end of the first quarter of 2025, includes US dollar-denominated FUM of US$2,06 billion, which was translated to local currency (ZiG) at the prevailing exchange rate.
“In the period under review, USD-denominated FUM accounted for 61,31 percent of total FUM, whereas the remaining 38,69 percent was FUM denominated in the local currency,” reads the newsletter.
On the other hand, ZiG denominated FUM declined by 8,84 percent to ZiG38,18 billion for the period under review from ZiG41,89 billion reported in the previous quarter, whereas the US dollar denominated FUM increased by 10,17 percent in the same to US$2,06 billion.
SecZim said FUM invested in property increased from 47 percent recorded in the previous quarter to 48,45 percent, while money market investments surged from 6,97 percent recorded in the quarter December 2024 to 8,85 percent reported on March 31, 2025.
Investment in unquoted equities increased to 4,50 percent from 4,26 percent recorded as at December 31, 2024. “Exposure to bonds increased from 6,37 percent recorded in the prior quarter to 6,62 percent whilst cash/call deposits and other investments all account for the remaining 2,23 percent,” SecZim said.
According to the newsletter, during the first quarter of 2025, a total of ZiG975,26 million worth of trades were settled through Chengetedzai Depository Company (CDC) and the ZSE Depository.
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