Government to leverage on equities market

Enacy Mapakame Business Reporter
Government has said there is no ‘blanket prescription’ for the disposal of public assets, but will leverage on the Zimbabwe Stock Exchange (ZSE) to commercialise several state enterprises.

It expects to raise US$350 million from the reform programme of state enterprise.

Ministry of Finance and Economic Development principal director Taguma Mahonde told The Herald Business that Government had an array of measures as part of the state enterprise reforms, which should unlock value and enhance efficiency in the long-term.

Mr Mahonde was representing Finance and Economic Development Minister Professor Mthuli Ncube at the ‘Zimbabwe Stock Exchange (ZSE) IPO Masterclass’ held in Harare on Tuesday.

Some, he said, would be merged, others privatised and listed on the stock market while others would be split into departments or dissolved completely.

“Government has made a decision on the issue of reducing the burden of the enterprises on the fiscus,” he said in an interview.

“By end of this year we expect to see something from the sale of assets from state enterprises, we are looking at raising about $350 million from sale of assets in some state enterprises.

“Some will be privatised, others will be merged, we do not have a blanket prescription and others will list on the stock market,” he said.

However, Mr Mahonde could not give more information on the state enterprises that would be earmarked for listing or asset disposal.

As part of initiatives to improve the business environment Government is working on various reforms that should also enhance competitiveness.

For state enterprises, these have been a strain on the fiscus as some had become perennial loss makers and uncompetitive due to among other reasons, gross mismanagement and poor corporate governance.

Reforms should therefore help restore them and ensure they contribute significantly to the country’s gross domestic product (GDP).

In a presentation made on his behalf, Minister Ncube highlighted listing on the local bourse would be ideal for state enterprises in unlocking value.

“The Government has a majority stake in 43 business enterprises that it seeks to either partially or wholly commercialise. Among the option for commercialisation is issuance of shares through the stock exchange.