Zimbabwe bourse fails to resume trading

Zimbabwe’s stock exchange failed to resume trading since reopening on Jan. 5 after the holiday break, said Emmanuel Munyukwi, the bourse’s chief executive officer, without providing a reason. "We don’t know exactly when trading will resume because we are still investigating various issues," Munyukwi said by phone today from Harare, the capital. Munyukwi couldn’t provide further details because he’s still on vacation, he said.

Trade on the Zimbabwe Stock Exchange ground to a halt after the country’s Securities Commission on Nov. 20 ordered stockbrokers to submit audited financial reports of their net worth by the end of December 2008. The commission on Dec. 16 warned broking firms they would be closed if they failed to meet the deadline.

Zimbabwe has world’s highest inflation rate, which the government estimates at 231 million percent, spawned by a decade of economic recession that caused shortages of food, fuel and other basic commodities. Investors with cash in Zimbabwe prefer to buy shares to avoid their money losing value, helping some individual stocks on the Harare-based exchange to post increases of as much as 100,000 percent a day last year, according to Imara Holdings Ltd., a Gaborone-based brokerage. Kingdom Stockbrokers, a Harare-based broking firm, said trade hadn’t resumed on Jan. 5 as a result of central bank measures announced on Nov. 17. "Trades on the bourse are supposed to be backed by a letter of confirmation from bank CEOs, something which will prove difficult to implement as CEOs would argue that their hands are already full at the moment," Kingdom said in an e- mailed statement today.

Reserve Bank of Zimbabwe Governor Gideon Gono in November accused banks in the southern African country of using fraudulent checks to artificially inflate share prices. Companies whose shares trade on the Zimbabwe bourse include Old Mutual Ltd., a unit of U.K. insurer Old Mutual Plc, Econet Wireless Holdings Ltd., Zimbabwe’s biggest mobile-phone provider, and Kingdom Meikles Africa Ltd., which has interests in the leisure, banking and retail industries. (SADOCC)


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