Electronic trading of shares on the Zimbabwe Stock Exchange (ZSE) will start next year, as the bourse seeks to qualify for a project financed by regional bank to harmonise stock exchanges in southern Africa, an executive has said.
ZSE is set to replace the manual trading system with an automated one, expected to increase the volume of trade and extend working hours as brokers would do business in their offices.
Under the current set-up, brokers have to go to the exchange every working day to buy and sell shares and trading time is normally one and a half hours.
ZSE chief executive officer, Alban Chirume last week said the African Development Bank (AfDB) was reviving the harmonisation of stock exchanges in southern Africa to be able to trade across borders.
"We need to be automated for us to be in that. That's why we need to ensure that by next year we are automated because [presently], we can't be part of the process," he said.
The harmonisation of stock exchanges was mooted some years ago but was abandoned due to the absence of funding.
"... the African Development Bank has been going through all the exchanges discussing with them about the possibility of financing that project," Chirume said.
He said the JSE, Botswana and Namibia stock exchanges were pencilled in the first phase.
Chirume said the bourse has a budget of US$2 million for automation.
ZSE's push for automation has seen the appointment of Central & Settlement Co. (CDSM) of Mauritius as the consultant for the automated trading system.
CDSM operates the securities central depository in Mauritius and also provides ICT services to Stock Exchange of Mauritius.
The consultant is expected to review business processes of the ZSE, prepare a request for proposals, advise the bourse on the process of vendor selection, and prepare the system for implementation.
Chirume said the consultancy role had attracted interest from firms in Zimbabwe, South Africa, East Africa, Mauritius, South Asia, but ZSE had settled for the Mauritian company, as it had a visible "footprint in the automation project carried out elsewhere in Africa".
Automation will run together with central securities depository (CSD) to help in the settling of transaction.
Chengetedzai Depository Co-mpany was in 2010 awarded a tender to run the country's first securities depository system.
Standardbusiness reported last week that Chengetedzai shareholders would raise US$1,5 million from existing shareholders to roll-out the projects.