Harare, (New Ziana) – FBC Securities Private Limited, a
prominent stockbroker, has urged the government to strengthen domestic
revenue mobilization, improve investor confidence and restructure
state-owned enterprises (SOEs) in view of an expected reduction in
external financial support.
In a statement titled “US Foreign Aid Halt: Impact on Zimbabwe’s
Economy,” FBC Securities urged immediate government action to mitigate
potential destabilization of critical economic and social sectors.
The call for intervention comes in the wake of US President Donald
Trump’s announcement of the country’s withdrawal from the World Health
Organisation (WHO) and the suspension of funding to PEPFAR (President’s
Emergency Plan for AIDS Relief).
This ban threatens to disrupt vital supplies of anti-retroviral drugs
(ARVs) and resources for programs addressing HIV, tuberculosis (TB), and
malaria in Zimbabwe.
“To mitigate these challenges, the Zimbabwean Government must take
decisive action by strengthening domestic revenue mobilization,
restoring investor confidence and restructuring state-owned enterprises
(SOEs),” FBC Securities said.
“These strategies are deemed essential for navigating the challenges
posed by declining external support and ensuring long-term economic
resilience,” it added.
The stockbroker also suggested that Zimbabwe seeks alternative funding
from other international donors, regional partners, and non-traditional
allies, including the African Union and Southern African Development
Community (SADC).
Such partnerships, it said, could provide crucial financial and
technical assistance, replacing the withdrawn US support.
Furthermore, FBC Securities reported that NGOs contributed significantly
to foreign currency liquidity, accounting for 10% and 9% of total
foreign currency receipts in the first nine months of 2023 and 2024,
respectively.
FBC Securities warned that a reduction in these cash inflows would lower
disposable incomes and consumer spending, particularly impacting
vulnerable communities in rural areas.
It predicted a decline in bank deposits in Foreign Currency Accounts,
foreign currency inflows in general, diminished stock market liquidity,
and increased volatility in blue-chip stocks because of the US action.
New Ziana
