Tigere predicts tight liquidity as ZiG sets in

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 By Alois Vinga

REAL Estate Investment Trust (REIT), Tigere Property Fund has predicted a tight liquidity environment owing to the central bank’s ongoing work on the inception of the Zimbabwe Gold (ZiG) currency.

On April 5, the Reserve Bank of Zimbabwe introduced a new “structured currency” ZiG to tackle the ongoing economic crisis in the country. The new currency is backed by gold, and other precious minerals, and will circulate alongside other foreign currencies.

The ZiG currency is trading at a rate of 13:56 against US$1,00 and is also enjoying a stable exchange rate with less volatility.

Presenting a trading update for the three months ended March 31 2024, Tigere predicted very tight liquidity shortly.

“The official exchange rate depreciated by a noteworthy 256% during the period under review which was largely due to the continued closure of the auction system along with depressed PGMs prices. Going forward, we estimate a tightened liquidity environment as the new central bank Governor works to assure stability in the recently issued Zimbabwe Gold (ZIG) currency,” said the company.

The REIT’s projections are however in sync with current realities which have seen limited availability of the new ZiG currency in the first month of the currency’s initiation.

However, experts have attributed the limited supplies to the Structured nature of the currency arguing that only an expansion in gold reserves will guarantee further expansion.

Meanwhile, TIGERE said during the period, demand for quality retail infrastructure remains elevated; however, the supply of stock has been limited by unattractive financing options.

“Notwithstanding, the development of clusters, student accommodation facilities, corporate housing and warehouse space has continued on an upward trajectory. The ongoing infrastructure works will provide opportunities as the road networks expand to new areas and shorten travel distances.

“The anticipated introduction of a new currency affected tenant receipts for Q1. In line with our growth strategy, the REIT has undertaken strategic capex projects.

”New tenants will improve the long-term net income and tenant mix within the portfolio. Highland Park Phase 1 continued to benefit from record customer visits and the opening of Phase 2,” said TIGERE.