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Capital markets plan to be completed before 2025

THE Securities and Exchange Commission of Zimbabwe (SecZim) says it has started work on establishing a Capital Markets Development Plan that will be completed before the end of the current five-year economic plan — National Development Strategy 1 (NDS1).

In November 2020, the government launched a five-year economic blueprint targeting an economic growth rate of five percent per annum to catapult the country into an upper middle-income economy by 2030.

Under the Capital Markets Development Plan, policymakers, market intermediaries, regulators, and investors will have a common understanding that will assist in influencing policy development and the general course that the country should pursue.
SecZim chief executive Anymore Taruvinga told The Financial Gazette that something was being worked on although there were some challenges.
“It was sort of laid back, but we are thinking of reviving it and when we have something substantial, we will provide the market with an update,” he said.

Taruvinga hopes that the plan can be agreed upon and adopted at the national level.
“We need the buy-in of other stakeholders so that we can actually agree when we can issue an update because the government and intermediaries are part and parcel of this,” he said.
“We still have to come to a round table on how we actually come up with that. We hope that it should coincide with NDS 1, which is currently underway, and come up with a plan before the end of the economic blueprint.”
The Capital Markets Development Plan draws parallels with other national development plans in certain sectors, like the mining and tobacco industries.
Capital markets are, like other sectors, essential for the wellbeing of any economy, thus the need for a development plan.
“So, it is just a plan that sets certain targets at the national level in terms of capital markets to say that by such and such a date or by such and such a year, our aspirations as a country are to attain certain metrics. It could be market size, number of listings, number of products, or a certain capital markets rating,” he explained.
“So, you set those targets, and then you look at what are the necessary items, policies, steps, and actions that we need to take to ensure that we achieve those set targets.”
Kenya and Nigeria are some of the countries that have successfully implemented the plan.
In June 2022, the government instituted a raft of measures to tame inflation and stabilise prices.
One of these measures was a decision by the Reserve Bank of Zimbabwe to hold its key policy rate at a record high of 200 percent to ensure the current disinflation trend is sustained in both the short and long term, that is until monthly inflation attains desired levels of less than five percent.
These measures had an impact on the capital markets.