It is a literal portrayal of how Zimbabwe’s foreign currency shortages are keeping investors away.
Brokers on the Zimbabwe Stock Exchange (ZSE) are failing to access the market’s automated trading platform after the software supplier withdrew support services due to non-payment.
Infotech, a software company based in Dubai, is the vendor for the system and provides tech support. But a circular to brokers from the ZSE on Thursday said the exchange does not have the foreign currency to pay the company.
“As a brief background to the matter, the ZSE is obliged to pay maintenance fees for support to Infotech on an annual basis. ZSE has not been allocated the foreign currency required for payments to be made in respect of 2018 maintenance and support fees. Infotech has withdrawn support until payment has been made,” the ZSE circular said.
The exchange does not say how much is owed.
The market trades about $2 million per day. Foreigners are already net-sellers, and such disruptions will only highlight the hurdles they face when investing in Zimbabwe.
While trade is still happening, brokers are unable to get the real time reports they need to make trade calls.
The ZSE started using the automated system in 2014 to replace the traditional call system, where brokers had to physically attend trade sessions at ZSE. The automated platform allows brokers to buy and sell stocks using an online platform.
Foreign currency shortages have worsened in recent months, forcing industry to scale back operations and causing commodity shortages. The backlog for foreign currency is estimated by leading businesses at close to US$1 billion. Recently, Delta Beverages said it owes foreign suppliers US$41 million.