A technical committee set up last year by the Securities and Exchange Commission (SEC) has recommended improved and enabling business environment as the necessary component towards ensuring the development of the Commodities Trading Ecosystem in Nigeria.
According to the report which was published last week on the SEC website, the enabling environment should include the following:
- Improved infrastructure
- Review of the Land Use Act
- Macroeconomic policy, and
- Access to finance, etc.
These recommendations are aimed at encouraging food sufficiency and security, strong trades in export commodities, and the encouragement of strong international presence in the local exchanges.
The report also noted that in order to ensure overall success in the commodities market, there is the need for increased demand and liquidity.
agricultural and solid mineral sectors should be attractive enough to encourage participation across the value chain. This means that
constraints to the development of the sectors should be regularly assessed by relevant Government agencies and efforts made to remove identified constraints. In addition to removing existing impediments, new policies with potential to facilitate agricultural and solid mineral development should be periodically introduced.
Background to the report
In June 2017, the Securities and Exchange Commission set up a technical committee on Commodities Trading Ecosystem as part of efforts aimed at actualising its ten-year master plan for the capital market.
The committee was tasked with the responsibility of identifying prevailing problems in the existing framework, as well as recommending the way forward. Specifically, the committee was to recommend ways of boosting agricultural and solid mineral production and by extension increase the offering of such commodities in the capital market.