Eleni, a private company positioned as the premier commodity exchange promoter in Africa, announced on Thursday the formation of a private-public investment consortium to finance the establishment of the Ghana Commodity Exchange (GCX).
Investment consortium partners include Ghana’s top tier financial institutions, Data Bank Agrifund Manager Ltd, Ecobank Ghana Ltd, UT Bank Ghana Ltd, as well as IFC, 8 Miles Fund and eleni, with minority stakeholding by the Government of Ghana.
The consortium partners and the Government of Ghana have jointly signed a Letter of Intent with the aim of completing the investment process by April 2014 and launching the GCX over a 12 month period through early 2015.
A second consortium is also in formation for a large-scale investment in warehouse and logistics infrastructure and equipment in eight delivery sites around Ghana as a strategic eco-system partner to the GCX.
In his second State of the Nation Address delivered on February 25, President John Dramani Mahama announced that as part of efforts to create an orderly, transparent and efficient marketing system for Ghana’s key agricultural commodities to promote agricultural investment and enhance productivity, the Government had committed itself to the establishment of a Ghana Commodity Exchange (GCX) and associated Warehouse Receipt System (WRS).
This move is to encourage market access and fair returns for smallholder farmers and to facilitate the formalization of informal agricultural trading activities. It is expected that the establishment of the Ghana Commodity Exchange will position it as a West Africa regional hub for commodity trading activities.
The GCX will start with spot and future trading of primarily agricultural commodities, including maize, soybeans, paddy rice, palm oil, groundnuts, among others and will introduce other key agricultural and non-agricultural commodities in what is envisaged as a future regional trading platform.
“This exchange will undoubtedly have a transformative impact on our economy and we are very pleased to be backing it, stated Samuel Ashitey Adjei, MD of Ecobank Ghana Ltd. “Following on the success of the Ethiopian model, the African commodity exchange momentum is real.
We can think of no better time and no better place than Ghana today to start a new thrust of developing an efficient and transparent price discovery platform. Ghana’s exchange has every potential to become a leading West African hub for globally traded commodities and we are excited to partner with the consortium to bring this idea to reality, noted Dr. Eleni Gabre-Madhin, chief executive officer, eleni.
“The Ghana Commodity Exchange initiative has been in consideration for some time, and long overdue. It is an idea whose time has come, stated Mr Robert Dowuona Owoo, GCX Project Coordinator and former Head of Policy, Research and IT at the Ghana Securities and Exchange Commission.