Stock brokers in Zimbabwe where left stranded Tuesday after Harare City council closed a building housing the Zimbabwe Stick Exchange due to failure to settle water bills.

Council officials are demanding outstanding $7000 from several tenants accommodated at the building. Investors where not certain if there would be any trade Wednesday. However, ZSE authorities where making frantic efforts to secure an alternative trading place.

Trade sessions are held every weekday in the morning. A ZSE official on Tuesday said that the bourse could temporarily relocate to another building to allow trade to continue and avoid inconveniencing brokers.

“We are likely to move trading to another building said the official. The closure is a big blow to the stock exchange that has seen trade shrink 19 percent since December last year, while market capitalization dropped to US$3.19 billion in June from nearly $4 billion at the beginning of the year, according to figures released by the Reserve Bank of Zimbabwe recently.

The drop in trade figures is chiefly blamed on foreign investors fleeing the bourse, scared by a controversial government scheme to compel foreign-owned businesses to sell stake to local blacks. Under the programme all foreign- owned firms valued at US$500, 000 or more will be required to transfer significant stake to locals by 2015.

New chairperson of the management committee of the Stock Exchange, Ndodana Mguquka recently told the local media that the bourse if failing to attract investors. He said, “Currently our capitalization is just above US$3 billion and is falling, but if we attract big companies to list, especially in the mining and banking sectors, we can grow the size of the market up to levels of US$10 billion.”

“As the new executive committee, we are looking forward to reviving the ZSE. At the moment there are a lot of issues that need to be sorted out, particularly the quality of our listings. We need to improve the quality of our listings to attract foreign and local investment.” On 14 July, Finance Minister Tendai Biti had given a good summary of the ZSE’s woes in his 2010 Mid Term Fiscal Policy Review to Parliament.

He said: “Trading on the Zimbabwe Stock Exchange has largely been low, mainly due to market illiquidity in the first half of the year. Foreign participation has remained subdued with investments mainly confined to portfolio restructurings. Corporate results have also failed to uplift the equity market as most corporate are still undercapitalised and also suffering from subdued demand.” He said that on average take-up of recapitalization rights issues had only been 50%, and underwriters