The Minister of Finance, Mr Ken Ofori Atta, has said the Ghana Commodity Exchange Market (GCX), will transform the country’s economy by creating prosperity for all the actors in the commodities value chain.
He said the GCX would create more value for all stakeholders in the commodity trading industry, especially farmers and improve the country’s export capacity as well.
Speaking at the launch of the GCX in Accra on Tuesday, he said; “Today, a new market has been born and this market will transform the economy.”
“The GCX is a new pillar of the financial system and this again shows our resolve to deepen our financial market and promote broad based growth which is key for restoring private sector investment in the agricultural sector which is critical,” he stated.
Transform agric sector
The Chief Executive Officer (CEO) of the GCX, Dr Kadri Alfah said the GCX had a goal of supporting farmers and helping them develop their markets and income.
He said the market would lead to a transformation of the country’s agricultural sector as it sought to create more bargaining power for smallholder farmers and provide accurate and reliable information.
“The market will provide a platform where farmers can easily find buyers and be paid within 24 hours. Buyers will also be guaranteed of the quantity, quality and safety of the products they buy on the GCX,” he explained.
Dr Alfah noted that the GCX currently had six warehouses across the country and had intensions of increasing them through the government’s one-district, one-warehouse initiative.
He said the warehouses were well equipped to receive, clean, dry, grade, re-bag and weigh grains into standard bag sizes for storing.
He said each warehouse was linked to farmer cooperatives which were cultivating maize, beans or both.
Access to finance
The CEO also pointed out that the GCX would give farmers increased access to finance because the receipts that would be issued could be used by the farmers as collateral for loans.
“We have banks and financial institutions which are working with us and are prepared to accept the warehouse receipt as collateral from the farmers,” he stated.
The GCX is a private company limited by shares, structured as a public private partnership with the government currently as the sole shareholder.
The aim of the exchange is to establish linkages between agricultural and commodity producers and buyers to secure competitive prices for their products.
The exchange will be operated on a Warehouse Receipt System modelled after a similar one in Ethiopia.
The grains that will be traded in the GCX warehouses would be sold through the transfer of ownership from the seller to the buyer, with both well aware of the condition of the grain in advance before settlement.