Online Reporter
Zimpapers Business Hub
The development of robust capital markets is not merely a technical financial requirement, but a “duty of a higher order” essential for Zimbabwe’s national resource allocation and economic competitiveness.
This was the core message delivered by Old Mutual Zimbabwe Group chief executive, Mr Samuel Matsekete, who was the guest of honour at the fifth edition of the Capital Markets Awards hosted by Financial Markets Indaba in Harare last week.
Addressing a distinguished gathering of capital market players, regulators, policymakers, and financial professionals, Mr Matsekete emphasised that efficient capital markets serve as the most time-tested mechanism for channelling national savings into productive long-term investment.
Mr Matsekete posited that capital markets are a vital instrument for promoting broad-based economic and financial inclusion.
He noted that while financial literacy is a prerequisite, the ability to “securitise” ventures allows ordinary citizens to participate in the value created by large-scale businesses, even if they do not have the capital to run such entities themselves.
“Once I am literate and I feel the urge to participate in the economy, but I don’t have enough money to run my own entity, how do I participate?” Mr Matsekete asked.
“You can securitise business and debt instruments to make everyone afford to participate in the value being created.”
Challenging the “crime scene” perception
In a direct appeal to policymakers, the Old Mutual chief cautioned against heavy-handed regulations that stifle market activity. He warned that when capital markets are treated as “crime scenes,” the broader economy suffers through inefficiency and a lack of reliable reference points for pricing long-term debt.”
When we make capital markets feel like crime scenes, we are actually working against our own broader good because we become less efficient in the way that we allocate our very scarce resources,” he said.
He highlighted that without a functioning market, it becomes difficult for the nation to determine the correct cost of capital for cross-border investments, potentially leading to suboptimal pricing and reduced global competitiveness.
Mr Matsekete, who also oversees risk management in his capacity at Old Mutual, drew a parallel between traditional community grain pooling and modern financial markets.
He argued that advanced economies are better at managing risk because they have sophisticated instruments to pool assets and investment securities.
“Those that have weaker financial and capital markets always live and do business ‘naked’ because they are not covered in terms of risk,” he remarked, urging the industry to innovate beyond traditional equity and debt.
He challenged market players to create bespoke products for the Small to Medium Enterprise (SME) sector and to look beyond the “traditional” to transform and formalise the Zimbabwean economy.
Commenting on this year’s awards, Financial Markets Indaba managing director Patrick Muzondo said the awards have grown into one of the most prominent and eagerly anticipated events on Zimbabwe’s financial calendar.
He said the awards “not only as a platform to celebrate excellence but also as a catalyst for strengthening the growth, integrity, and long-term direction of the country’s capital markets in support of wider economic and financial sector development”.
“Central to the Awards’ credibility is its rigorous and transparent evaluation process, conducted by an independent specialist research team, through which all submissions are assessed against clearly defined criteria encompassing performance, leadership, market influence, innovation, corporate responsibility, reputation, transparency, regulatory compliance, and overall contribution to capital market development, thereby ensuring that each recipient genuinely represents best practice and excellence within the industry,” said Mr Muzondo.
