President Nana Addo Dankwa Akufo-Addo has launched the Ghana Commodity Exchange (GCX) which is intended to boost agricultural productivity in the country.
The GCX is a platform that is expected to connect farmers to buyers in order to assist them obtain competitive prices for their produce. It is also expected to provide them with a guaranteed market.
The innovative platform is the first of its kind in West Africa and the third on the continent after Ethiopia and South Africa. It will start with trading in food crops such as maize, millet, sorghum, groundnut, dry beans and soya bean, with more commodities set to be traded later.
Speaking at the launch, President Akufo-Addo expressed concerns that even though farmers in the country break their backs to feed the population, they have no guaranteed incomes.
According to the president, “most transactions in the agricultural sector are conducted by word of mouth or handshake agreements without formal contractual agreements.” He observed that this accounts for the disputes and uncertainties in the sector leading to low productivity.
The president expressed optimism that the exchange will improve the take-home sales of farmers; afford them short-term loans using their commodities as collateral, as well as provide them with daily real-time market and price information directly via text messaging.
He emphasized that “Government will make sure that the Ghana Commodity Exchange delivers on its mandate, and promotes high productivity, price stability, increased exports, and reduced imports of commodities. The Exchange, in light of the emerging regional and continental free trade area, can position Ghana as the premier West African global trading hub.”
The GXC is intended to be a public private partnership. However, at the moment it has 100% shareholding by Government of Ghana (GoG). Its business operations consists of a trading platform powered by a provider trading system, and warehouse storage operations linked to the exchange through an electronic warehouse receipt system (e-WRS), backed by collateral management services.