Forex Shortage leaves Zimbabwe Stock Exchange without technical support
The Zimbabwe Stock Exchange (ZSE) says it is unable to fix a problem with its trading system after a technical support company withdrew its services for non-payment.
It’s the latest example of how a shortage of foreign-exchange is curbing economic output in Zimbabwe, where gold miners have halted production and millers have been unable to import wheat.
Last week stockbrokers failed to access the market’s automated trading platform after its Dubai based software supplier, Infotech, withdrew support services due to non-payment.
In a circular to market players, the local bourse said it had not been allocated the foreign currency required for payments to be made in respect of 2018 maintenance and support fees, and as a result, its software supplier had withdrawn its support services.
This is despite the stock market is a major contributor to foreign inflows over the years.
“We refer to the above and confirm having noted anomalies since November 14, 2018, when we tried to access reports from ZSE Automated Post Trade Reporting System (PTRS). Some reports are coming out and some are failing completely.
“The ZSE is obliged to pay maintenance fees for support to Infotech on an annual basis,” it said.
ZSE said it has not been allocated the foreign currency required for payment to be made in respect of 2018 maintenance and support fees. Infotech has withdrawn support until payment has been made.
“As a brief background to the matter, the ZSE is obliged to pay maintenance fees for support to Infotech on an annual basis. ZSE has not been allocated the foreign currency required for payments to be made in respect of 2018 maintenance and support fees. Infotech has withdrawn support until payment has been made.”
The ZSE and almost all the players in the market have not been getting allocations for software licensing, with the ZSE saying it believed it was important to share the information, “as we are all exposed to foreign currency shortages”.
The ZSE requires support from Infotech to rectify the matter, according to the notice.
For the past three or so years, foreign investors have been facing challenges to repatriate investments after disposing of their shares.
This is in addition to failure to repatriate dividends, as evidenced by beverage manufacturer Delta, which is struggling to send dividends to major shareholder AB InBev amounting to approximately $50m.