In Dar es Salaam the shock waves were
felt on shilling after appreciating almost 10 per cent against British
pound in about a week due to depreciation of the Pound Sterling.
On Dar es Salaam Stock Exchange (DSE)
the impact was also experienced on Acacia Mining share price movements
going north affected by price appreciation in London. The firm is listed
on DSE and FTSE in UK.
DSE Chief Executive Officer Mr Moremi
Marwa said the Brexit may have some insignificant impacts on portfolio
investments at the market because it is not that much connected to the
global market. He said however there may be some impacts on the foreign
direct investments.
“We might see some effect on FDIs as
investors may cut down their investment activities as (global) markets
are plummeting,” Mr Marwa said. “(Also) it depends on the kind of
investments… but we will learn more as we go.
We will continue to see how it will
impact our markets and global ones,” Mr Marwa said. On DSE’s market
capitalisation may have same impact on share price movements of one
heavy weight firms at the exchange - Acacia Mining.
The fluctuation may occur since Acacia
shares are quoted in pound in the London Stock Exchange (LSE) and are
converted into shillings in the Dar bourse. The pound sterling
depreciation is good for investors as listed share on London exchanges
are going to be relatively cheap if you buy from outside.
Trading data from London’s Financial
Times Stock Exchange (FTSE) showed that Acacia Mining share appreciated
by 29.91 per cent in a week time to 454.00p at 13:08 hours last
Thursday.
The share on DSE, the largest mining
firm in the country, closed at 13,360/- of last Thursday compared to
10,460/- of last previous Friday, reflecting a gain of 27.72 per cent in
just five days.
The Acacia share gain has minimised the
negative effect of the shilling appreciation a gainst the pound sterling
on DSE market cap that slide by merely 1.0 per cent in five days. The
firm has cross-listed to DSE from FTSE.
The gold firm, London listed miner,
share price on DSE are calculated based on the exchange rate of the day.
The last week gain reflected dropping value of British pound against
shilling.
Zan Securities, Chief Executive Officer
Raphael Masumbuko, sees positive impact on the country and bourse in
general. “EU will now regard UK, after Brexit, like any other country
outside their union. This means UK investment stops receiving special
privilege hence they will channel their investments to other markets
like Africa,” he said.
“Remember UK is among top three
investors in the country. They may now look to us since we may have
opportunities more than some countries in the EU,” Mr Masumbuko said.
He said with pound sterling going down
stocks in UK are becoming cheap to foreign investors thus increase the
chances of better way of raising capital. “You see, the share price of
Acacia was already up.
This was one sign of positive reaction
of the Brexit,” Mr Masumbuko said. On the other hand shilling has
appreciated over 9.0 per cent against British pound since the United
Kingdom voted to exit from European Union.
The shilling gain has pushed down DSE market capitalisation as well by slightly over 1.0 per cent in the same period.
According to Bank of Tanzania (BoT)
forex data, climbed up from 3,264/59 of last Friday to 2,955/43 of
yesterday, thus making imports from UK relative cheap by 9.0 per cent.
The International Monetary Fund (IMF)
predicts that by 2019 the Commonwealth will contribute more to the
world’s economic output than the EU
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