Zimbabwe’s Dollar-Only Stock Exchange Hits US$1.8 Billion Market Value

Zimbabwe’s US dollar-only stock exchange is enjoying a strong rally, largely driven by gold producers benefiting from a 48% surge in the metal’s price this year.

The Victoria Falls Stock Exchange (VFEX) has seen its benchmark index jump 45% so far, pushing its market capitalization to around US$1.8 billion by the end of September.

Launched in late 2020 with the aim of attracting capital, especially for mining ventures, the VFEX now has 17 listed companies. Chief Executive Officer Justin Bgoni said the exchange is on track to add at least five more listings by year-end, spanning mining, property, and other sectors. He noted that valuations on the VFEX are now beginning to align with those of regional peers.

The latest entrant, UK-based Kavango Resources, listed last month and became the third gold-focused company to join the bourse. It joined the likes of Caledonia Mining Corporation and Padenga Holdings Limited, which also operates in the crocodile skin business.

“These stocks are effectively serving as a proxy for gold,” said Lloyd Mlotshwa, head of research at IH Securities. “The companies positioned themselves well, investing early and expanding production just as the gold boom took off.”

Another factor fuelling VFEX’s rise is the shortage of ZiGs, Zimbabwe’s local currency, which has led many investors to shift away from the Harare-based Zimbabwe Stock Exchange in favor of the dollar-only market. “ZiG liquidity is weak,” Mlotshwa explained. “As a result, investors prefer to transact in US dollars.”