A NEW equities exchange market for parastatals is on the cards to raise capital for the ailing entities, State Enterprises and Parastatals minister Gorden Moyo has said.He told delegates at the mining indaba this week that state enterprises would not list on the Zimbabwe Stock Exchange (ZSE) due to listing requirements and standards which are too high for parastatals.
Report by Gamma Mudarikiri
Most parastatals are undercapitalised, he said.
“Parastatals are going through a raft of challenges and are in dire need of recapitalisation and therefore do not qualify to be listed on the local bourse,” said Moyo.
He said his ministry last week sent a delegation to China to study and copy the country’s model of listing parastatals as part of efforts to create a bourse for local state enterprises.
Zimbabwe has 78 state enterprises with capacity to contribute 40% to the country’s GDP, but most of them are operating below capacity and carrying huge debts.
As part of plans to revive parastatals, government in 2009 earmarked 10 of the entities for privatisation including Air Zimbabwe, NetOne, TelOne, POSB, GMB, CSC, Agribank, Zesa, NRZ and Ziscosteel.
However, little has been done to restructure the state enterprises as they continue to be choked by huge debts, under-capitalisation and mismanagement.
Moyo said government has also entered into performance based contracts with management of the entities in a bid to improve service delivery, public accountability and efficiency.
On the mining sector, Mines and Minerals minister Obert Mpofu said his ministry was pushing big mining companies like Mimosa and Zimplats to list on the local bourse.
Of the 78 listed companies on the ZSE, only three are mining companies.
Mpofu said ZMDC, which he described as a silent conglomerate, also has plans that are at an advanced stage to list on the ZSE.
The Youth Development, Indigenisation and Empowerment ministry early this month also revealed plans to create another stock market, the “indigedex”, which will trade in shares from the indigenisation fund.
Brainworks, a local private equity firm, also announced plans for another exchange to be called the Harare Stock Exchange last week.