Developing an organized commodity exchange in Ghana: Challenges and economic prospects

Mohammed Iddrisu Ngmenipuo () and Osman Issah
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Mohammed Iddrisu Ngmenipuo: Wa Polytechnic Business School
Osman Issah: University for Development Studies School of Business and Law

Journal of Economic and Financial Studies (JEFS), 2015, vol. 3, issue 2, 41-54

Abstract: We have examined challenges and economic prospects of establishing an organized Commodity Exchange in Ghana. We find that such a market will result in reduction in post-harvest losses through price stability, improvement in commodity price risk and credit risk management, provision of a transparent and competitive price discovery mechanism, reduction in transaction and marketing costs, and avoidance of making the mistakes of others. However, we also identify the challenges that should be resolved such as lack of laws and regulations specifically pertaining to the commodity exchange; inadequate financial support; lack of trading infrastructure; inadequate volume; liquidity problem; smallholder farms; lack of understanding of trading instruments; and government/political interference to this end. Overall policy implications suggest inadequate infrastructure and capacity building of market participants should be enhanced.

Keywords: Commodity exchange; Price discovery; Price risk management; Warehouse receipt system. (search for similar items in EconPapers)
JEL-codes: Q10 Q13 Q14 Q18 (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:lrc:lareco:v:3:y:2015:i:2:p:41-54

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