Attempts by members of the Association of Coffee Producing Countries to boost the price of coffee through retention over the years failed to achieve the desired objectives.Some pundits on the basis of the current trend think that liberalization of the West African commodity sectors appears to be the single most significant cause of under-performance in those sectors.

Liberalisation, they said, has seriously failed West African farmers and hindered the development of rural economies. While acknowledging the importance of commodity sectors to national economies in Africa, experts are calling on the various governments on the continent to adopt measures that would improve price, trade and production of commodities.

Many argue that given the current climate of uncertainty in the cocoa and coffee markets, there is the need for effective policies to address the precarious situation created for producers by the very low prices offered on the international market.

However, Africa cannot single-handedly provide all answers to its current economic predicament.There is an international consensus that the continent is in dire need of regeneration to lift it out of its sorry state.Many prominent personalities on the continent are of the view that since Africa is heavily dependent on commodity exports, a dynamic marketing and diversification is needed to revive Africa’s agricultural sector.

As an attempt to revitalize what should be a thriving continent, Professor Thomas Kubi of MCA International Marketing and some other prominent personalities have decided to set up a West African commodities exchange. To be known as the Economic Community of West African States (ECOWAS) Exchange, the venture would operate from Accra next year and have 15 regional offices around the region.

The exchange, according to Prof. Kubi, is expected to trade a range of commodities including cocoa, coffee, cashew nuts, sunflowerseeds, fruits, vegetables, timber, gold, diamonds and crude oil.The prime client base for the exchange would consist of farmers, producers, processors, traders, wholesalers, retailers, buyers, sellers, carriers and transportation companies.

Most industry players have already welcomed the move to establish the West Africa commodity trading exchange in Ghana.The move, according to them, would help deepen Ghana’s financial sector which is gradually becoming a hub in the West African sub-region.

Professor Thomas Kubi, who would become the Chief Executive Officer of the West African Commodity Exchange when it becomes operational, told CITY&BUSINESS GUIDE in an interview that there was the need to ensure that the central roles played by commodities in the sub-region is maintained.

Prof Kubi believes that through proper marketing and support structures-probably using the West Africa Commodity Exchange- there is no doubt that the commodity market would flourish again in the sub-region.The total cost for setting up the proposed West African Commodity Exchange in Ghana is estimated at about $500 million.

The good news is that a Swiss credit support firm, Ace Audit & Control Expertise, has already agreed to back the project and the African Development Bank offered to provide funding.In addition, two institutions namely London International Financial Futures and Operations Exchange (Liffe) and Cocoa Association of London (CAL) have pledged to support the setting up of the exchange.


From dailyguideghana.com