Zimbabwe wants to create ‘Africa’s Dubai’ at Victoria Falls

Zimbabwe plans to set up an offshore financial centre in the resort city of Victoria Falls that the government wishes to vie with the likes of Dubai and the Isle of Man to attract foreign investment.

“The trigger is the success of the VFEX,” Finance Minister Mthuli Ncube said in an interview, a reference to the US dollar-denominated Victoria Falls Stock Exchange that’s experiencing a listings boom. “We want to compete with any offshore financial centre in the world.”

The project will “offer investors an environment comparable” to the Isle of Man, Mauritius and Dubai, he said.

Marc Holtzman, a US veteran banker with 35 years experience in emerging markets, has been appointed board chairman of the centre. Holtzman is also chairman of CBZ Holdings, Zimbabwe’s biggest lender.

The financial centre will be a hard currency zone, based on US dollars, and offer tax incentives. Land has been set aside by the state to attract global banks to establish offices in the country, according to Ncube. The VFEX, which officially launched in October 2020, will be housed under the financial centre.

The bourse has seen a surge in listings particularly in the last quarter of 2022, attracted by the trade in US dollars, tax exemptions on capital gains and the ability to repatriate funds from a country where foreign exchange is in short supply. It now has eight traded businesses.

“Two more companies are coming and two more are seeking approval,” Justin Bgoni, the chief executive officer at VFEX, said Monday by text message.

The listings on VFEX have led to de-listings on the main exchange in Harare, the Zimbabwe Stock Exchange, which trades in Zimbabwean dollars. Authorities won’t attempt to dictate to firms which bourse to list on, as this is informed by their unique capital needs, Ncube said.

“Companies are free to choose where to list,” he said. “I’m not too worried about companies moving across from the ZSE to VFEX.”

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