Stakeholders advocate functional commodities exchange




By Ginika Okoye

Some financial and capital market experts have called for effective collaboration, capacity building and education of stakeholders in the commodities trading value chain to guarantee a functional exchange market.

They spoke at an International Conference on Commodities Trading Ecosystem organised by the Securities and Exchange Commission (SEC) in Abuja on Tuesday.

Mr Laoye Jaiyeola, the Chief Executive Officer of the Nigerian Economic Summit Group, said that effective collaboration, capacity building of the required stakeholders in the ecosystem would help in the achievement of set goals in the ecosystem.

Jaiyeola explained that poor coordination was a major hindrance to actualising a vibrant commodities exchange.

“We need a lot of capacity building to get ready, we need significant coordination, bringing everybody together to know how we can ensure delivery.

“Let’s ensure that in making laws, all stakeholders get involved, let’s also ensure that policies are made to ensure that the integrity of the exchanges are guaranteed.

“I am one of the people that believe in smallholder farmers. Today, I believe that those smallholder farmers are taken for a ride, aggregators go and buy what they want to buy, but at the exchanges like this, they can know what the prices are and therefore, we can lift people out of poverty.

“So, we need to do a lot of coordination,’’ he said.

The chief executive officer lamented that farmers did not have access to the right and quality seedlings for production, hence the reason for poor yields in the country.

Prof. Uche Uwaleke, a financial expert, said that adequate government policies would help in repositioning the commodities exchanges in the country.

Uwaleke suggested adequate funding for the agricultural sector to involve more farmers in commodities exchange trading.

He commended the Central Bank of Nigeria (CBN) for reducing interest rates on their interventions from nine to five per cent.

“CBN said yesterday, that they will reduce interest rates on the interventions. They also insisted that they will not devalue the Naira because any attempt to do that will impact interest rates.

“This is a good move toward cushioning the effect of COVID-19 and crash in oil price.

“Many state governments’ are not allocating adequate fund for the agricultural sector and that is against the Malabo declaration.

“There is need to support educational institutions to encourage youths to go into agriculture,’’ he said.

Mr Yusuf Yila, the Director, Development Finance Department of the CBN, said that a functional commodities exchange ecosystem would have adequate physical market, including aggregation and infrastructure, financial market and regulatory framework, among others.

Yila said that a functional commodities market would help the efficiency of the bank’s Anchor Borrowers Programme (ABP) transaction dynamics.

“There is no gainsaying that functional commodity ecosystem will spur growth and help in terms of diversification, create jobs, and food security.

“It will help us in terms of price discovery, risks mitigation,’’ he said.

The conference with theme `Commodities Trading Ecosystem: Key to Diversifying Nigeria’s Economy’, attracted financial and capital market experts across the country. (NAN)

Source: NAN




Be the first to comment

Leave a Reply

Your email address will not be published.


*