Commodities Market Key To Nigeria’s Economic Diversification, Says SEC

Acting Director General of the Securities and Exchange Commission (SEC), Ms. Mary Uduak, on Monday in Abuja, described the commodities trading ecosystem as an important market capable of playing a strong role in diversifying Nigeria’s economy from oil, which is being championed by the Muhammadu Buhari administration.

Uduak, who was speaking at a capacity building workshop for judges and top management staff of the Investment and Securities Tribunal (IST), noted the importance of enhancing the market’s efficiency, growth, and competitiveness.
This, she believes, will better position it to also play a strong enabling role in such areas as food security and employment generation, besides other benefits in promoting commodities exchanges and the ecosystem in general as they provide a transparent pricing mechanism.

The acting DG, who was represented by the Acting Executive Commissioner Operations at SEC, Isyaku Tilde, also identified other benefits as promoting the attractiveness of agribusiness, fostering financial inclusion and improving quality of agricultural output and profitability, as well as government revenue.

It is also expected to enhance the wellbeing of the farming communities and help reduce rural-urban drift.
Recall that the Acting DG recalled that the commission, as part of its implementation of the 10-year Capital Market Master Plan, constituted a Technical Committee on Commodities Trading Ecosystem whose mandate was to identify challenges of the existing framework/infrastructure and develop a roadmap for a vibrant ecosystem.

“The Technical Committee set up to develop a roadmap for reviving the Commodities Trading Ecosystem came up with over forty (40) recommendations to be implemented in 4 phases between 2018 and 2025; the report also observed the knowledge gap that exists within the ecosystem and recommended the need for capacity building on the Commodities Trading ecosystem to stakeholders and to the general public,” she stressed.

To ensure the implementation of these initiatives, the SEC constituted an Implementation committee consisting institutional members to drive the process, following which Monday’s training for the IST has become necessary to enable it effectively carry out its statutory function given its jurisdiction over securities-related matters, which includes the commodity trading market.

The successful implementation of the Technical Committee’s report she said, will undoubtedly lead to more activities in the market and this will result in disputes.
“Therefore, to effectively make informed decisions on commodities market-related disputes, the judicial and non-judicial staff of the Tribunal requires the basic knowledge on the Commodities Trading Ecosystem.
“It is without a doubt that investors’ protection is at the heart of market regulation. This implies that the most important participant in the capital market is the investor hence the overriding need for strong regulation and adequate safeguards coupled with an efficient dispute resolution mechanism” she added.
Commenting on the training, Chairman of IST, Siaka Isaiah Idoko-Akoh, commended the SEC for organizing the training, adding that with the way the market is progressing; commodity market has become a very important aspect.

“As the market grows, so will dispute by investors and we need to be adequately prepared to be able to resolve such matters. We have seen how Commodities exchanges have grown in other jurisdictions and we hope we will have more interface like this one to assist in moving the nation’s economy forward.

The Ecosystem is an organized commodities market consisting of multiple players that interact to form the agricultural value chain. They include commodity exchanges, farmers, merchants, aggregators, processors/producers, commodity market operators, warehouse operators, collateral managers, banks, insurance companies, clearinghouses, and logistics companies.

The Commodity Trading ecosystem provides a sophisticated human interaction of which the inevitable disputes will call upon the IST.

https://investdata.com.ng/2019/05/commodities-market-key-to-nigerias-economic-diversification-says-sec/