By Tony Obiechina, Abuja
AFEX Commodities Exchange Limited and FMDQ Group, Plc on Wednesday entered into a partnership geared towards products innovation for the development of Nigeria’s capital market.
A Memorandum of Understanding (MoU) to that effect was signed by the Chief Executive Officer of AFEX, Mr Ayodeji Balogun and the CEO of FMDQ Group, Mr Bola Onadele Koko in Abuja.
The collaboration between the two companies is aimed at product innovation in market development with a view to encouraging participation or wider scope of investors in the capital market.
Addressing stakeholders present at the signing ceremony, Mr Balogun, said, “AFEX is on a path to building Africa’s second commodities derivative market, and this partnership sets the tone for that journey. We are extremely proud to be collaborating with FMDQ, as this helps our goal of increasing our product offerings to investors.
“We see a clear path to product innovation that will unlock a wider range of products that are able to be traded within Nigeria’s capital markets, promoting broad-based wealth creation that’s accessible to every Nigerian.”
Also speaking, the CEO of FMDQ, Mr On Adele noted that as members of SEC’s Implementation Committee on Commodities Trading Ecosystem, an area focus for the partnership would be the Nigerian Agricultural Commodities Ecosystem.
According to him “our goal at FMDQ is to support the growth of the sector through commercial and market-driven propositions. Through the partnership, we will be introducing new products aimed at derisking the value chain”.
Information made available to Prompt News Online indicates that since it was establishment in 2014, AFEX Limited has developed and deployed a viable commodities exchange model for the West African market and has built a strong supply chain infrastructure to support the securitisation of agricultural products”.
AFEX also “operates 45 warehouses in Nigeria’s key grain -producing areas and accounts for 100,000 MT of total national storage capacity. Since 2014, the exchange has reached 106,000 farmers and traded 126,400 MT of commodities with a total turnover of N14.1 billion”.
On to other hand, FMDQ, considered as Africa’s first vertically integrated financial market infrastructure group, “is strategically positioned to provide seamless execution, clearing and settlement of financial market transactions through its wholly owned subsidiaries”.
It is said that, FMDQ “operates the largest Exchange in Nigeria, with an average annual market turnover of circa N233.00 trillion over the last six years, as well as the only Central Clearing House in Nigeria positioned to transition to a Central Counterparty”.
