Company wins a $200,000 World Bank contract to help set up a Commodity
Exchange in Tanzania
By Elleni Araya
October 23, 2012
Stalwarts Management Consultancy
Services, founded by former employees of the Ethiopian Commodity Exchange (ECX)
recently signed a 200,000 dollar World Bank contract, to conduct a feasibility
study that can set up a Commodity Exchange in Tanzania.
The World Bank had floated an
international tender for the feasibility study and design of a Tanzanian
Commodity Exchange in June 2012 of this year, under the Financial Sector
Capacity Building facility for the Bank of Tanzania.
The company started up by Yohannes
Assefa, former Senior Legal Adviser and Chief Compliance Office at ECX, and
Bharat Kulkarni, (PhD), former trading operation manager, signed the contract
on October 18, 2012, after finalizing negotiations which had started in
August,2012, when the company was awarded the project.
Other ECX alumni have also collaborated
with Stalwarts for the Tanzania project, including Aman Adinew, Former Chief
Operating Officer and Kadri Alpha, former Chief Risk Officer of ECX.
Together they are expected to provide a
business model, policy analysis, financial planning & debt structuring, and
investment advice services for the setting up of the exchange in Tanzania.
The area is not new to the management
team of Stalwarts as they had previously been involved in setting up exchanges
both in Asia and Africa. In Ethiopia they had been part of the team that had
done the feasibility study and the formation of ECX, the first exchange of its
kind in East Africa, under the leadership of Eleni Gabre-madhin.
This team's mostly made up of Ethiopian
professionals in the Diaspora that have come to lend their experiences in the
first few year’s of ECX’s operation.
Both Yohannes and Baharat were part of
the first four of the nine foreign ECX management team to leave in. Since
then all of the initial team has transferred management to local staff,
including founder Eleni who has taken on an advisory role.
Yohaness was the first to leave in June
2010, and Bahrat had followed the year after in August. Stalwarts was
established in September 2011, as a consulting firm registered and licensed in
India and the United Arab Emirates.
The Ethiopian experience is a good
selling point when competing for projects in Africa, according to Yohannes.
“We have already been tried and tested
in Ethiopia, in a place that had technological and infrastructure shortcomings
when the exchange was established in 2008,” he told Fortune. “This experience
is appreciated, in other African countries which is an advantage for us.”
Using this experience Stalwarts, is
also hoping to get contracts to set up a leather commodity exchange in Morocco
and agricultural commodity exchanges in Rwanda, Kenya and Ghana.
Prior to the Tanzania project,
Stalwarts company had been hired by Auction Holdings Limited (AHL), a
conglomerate that runs Malawi’s National Tobacco Auction System, to do a
feasibility study and develop a commodities exchange in Lilongwe.
AHL, which is partly owned by
government agricultural marketing enterprise, set its sight on establishing an
end-to-end commodities market when the Global demand for Tobacco, Malawi’s
largest agricultural export, fell.
Having presented a feasibility study
the company is now in the process of implementing its suggestions and forming
the exchange.
In Tanzania, it is unclear yet whether
Stalwarts will get another contract to implement the business model it will
present. “In presenting our proposal, we have made suggestions to be
included in the implementation but it is upto the government to decide,”
Yohannes told Fortune.
The Tanzanian government will set up a
secretariat to implement Stalwart’s proposal, according to him. In the contract
it is upto the Tanzanian government’s discretion to hire an outside company to
help with the implementation, he explained.
Nor is it known yet whether Tanzania’s
exchange will be private or public, although President Jakaya Kikwete had
indicated that he wants as little government involvement as possible.
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This article first appeared on the print version of the Weekly
on October 21, 2012