The Zimbabwe Stock Exchange has introduced sweeping temporary concessions aimed at making it easier for companies to list and raise capital on the local bourse. 

However, the reforms are already provoking deeper questions within financial markets following the recent exit of one of the exchange’s biggest and most valuable companies, Econet Wireless Zimbabwe.

Through Practice Note 18, issued on June 1, 2026, the ZSE has significantly relaxed several listing and compliance requirements in what appears to be a strategic attempt to revive activity on the ZiG-denominated exchange amid subdued liquidity, limited new listings and growing competition from the US dollar-based Victoria Falls Stock Exchange.

The measures reduce the minimum market capitalisation threshold for listings from US$10 million to US$1 million, lower free-float requirements from 30% to 10%, reduce the required shareholder spread to just 50 public shareholders, and provide greater flexibility around capital raising, underwriting and publication requirements.

The exchange says the concessions are intended to promote capital formation, facilitate access to the market for small and medium enterprises, reduce compliance costs and improve market participation.

Yet the reforms are arriving at a time when the ZSE is still grappling with the implications of Econet Wireless Zimbabwe’s delisting earlier this year.

For nearly three decades, Econet was not only one of the exchange’s flagship counters but also consistently ranked among the top two most valuable listed companies by market capitalisation.

Its departure therefore represented more than the loss of a listing. It exposed structural concerns about liquidity, valuation efficiency and the long-term ability of the local currency-denominated market to retain large corporates.

Econet cited persistent undervaluation as one of the primary reasons behind its decision to leave the ZSE.

At the time the company first announced its restructuring plans, it argued that the market had consistently failed to properly value both its operating business and its infrastructure assets despite its dominance in Zimbabwe’s telecommunications sector.

The company subsequently transferred its towers, power installations and property assets into Econet InfraCo, now listed on the VFEX, while the mobile telecommunications business continues operating as a privately held company.

At the time of delisting, Econet accounted for roughly a third of the ZSE’s market capitalisation and ranked among the exchange’s most actively traded stocks.

Its shares were widely held by pension funds, institutional investors and retail investors, making it one of the market’s most important sources of liquidity.

The implications of that departure now loom over the ZSE’s efforts to attract smaller issuers through relaxed listing standards.

Analysts say the central question confronting the market is straightforward: "If a company of Econet’s scale, market dominance and financial resilience concluded that the ZSE could not adequately value its business, what assurance exists that smaller companies entering under easier requirements will fare any better?"

Takudzwa Ndoro, a Rwanda-based Zimbabwean financial analyst, said unlike Econet, many smaller firms may lack the financial depth, market influence and strategic flexibility required to withstand prolonged undervaluation, weak liquidity or depressed trading conditions.

"Econet was ultimately able to restructure, migrate infrastructure assets to the VFEX and continue operating privately because of its scale, established cash flows and dominant market position," Ndoro said.

"Smaller firms may not possess similar options if they struggle to attract liquidity or investor interest after listing."

Some market participants fear that lowering barriers to entry without addressing underlying liquidity and valuation constraints could unintentionally expose smaller businesses to new risks rather than strengthen them.

In thinly traded markets, companies can remain listed yet struggle to raise meaningful capital, establish reliable price discovery or attract sustained investor participation. For smaller businesses, this can result in stagnant valuations, illiquid share registers and limited access to secondary capital raises.

Markets commentator Sean Gammon said that while the measures make it easier for advisors and issuers to bring companies to market, concerns remain around the quality and liquidity of such listings.

"As an advisor, I would have welcomed some of these new measures. It is much easier to list companies with limited shareholder spread, or raise capital without underwriting or issuing a prospectus," Gammon posted on LinkedIn.

However, he warned that relaxing liquidity-related requirements could weaken the effectiveness of the market itself.

"My experience is that listings that fudge the shareholder spread and liquidity requirements never perform as effective investment destinations. Liquidity is the single most important element of investment return," he said.

Gammon also questioned whether Zimbabwe’s increasingly fragmented capital markets structure risks creating further complexity for issuers and investors.

"These dispensations make our investment landscape overly convoluted. We have exchanges with different tax systems and different listing requirements, both overseen by the same organisations. Patching short-term problems is never ideal," he said.

Research and advisory firm Morgan & Co described the reforms as a recognition of the increasingly competitive environment facing the ZSE.

The firm noted that the exchange is contending with continued migrations to the VFEX, subdued liquidity conditions, limited new listings and rising issuer sensitivity to compliance and transaction costs.

According to Morgan & Co, the concessions may lower operational burdens and improve accessibility for prospective issuers, but broader concerns remain about whether the measures can materially improve liquidity, valuation efficiency and long-term capital formation.

That distinction may prove critical.

While regulatory concessions can lower the cost and complexity of entering the market, they do not automatically create investor demand, trading liquidity or valuation confidence.

Some analysts argue that the deeper challenge confronting the ZSE is not necessarily the strictness of listing requirements but rather broader macroeconomic uncertainty, currency instability, constrained institutional capital and limited foreign investor participation.

Without resolving those structural factors, critics say the exchange risks attracting smaller companies into a market environment that continues to struggle with liquidity and valuation challenges that even its largest corporates found difficult to navigate.

Supporters of the reforms, however, argue that Zimbabwe’s economic environment requires pragmatic flexibility and that lowering listing barriers may at least broaden participation and encourage the formalisation of growing enterprises that previously viewed public markets as inaccessible.

The ZSE has maintained that the measures are temporary and remain subject to regulatory oversight. Practice Note 18 will remain in force for 36 months, during which the exchange retains the power to impose conditions, revoke concessions or amend the framework in the public interest.

The only substantive correction I made was removing the incomplete phrase "frequently alternating between first and second place with ." because it appears a company name was omitted from the draft. You may want to insert the intended company before publication.