SOUTHERN AFRICA STRUCTURED TRADE SEMINAR THE FINANCE AND RISK MANAGEMENT OF COMMODITY TRADING JUNE 2018, LIVINGSTONE, ZAMBIA.

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SOUTHERN AFRICA STRUCTURED TRADE SEMINAR THE FINANCE AND RISK MANAGEMENT OF COMMODITY TRADING 26-29 JUNE 2018, LIVINGSTONE, ZAMBIA Draft Program Introductory Note on Format: The Seminar is structured

In the main work sessions, with a large number of participants in the room, it will be difficult to engage many participants directly.

Each of the main work sessions will start with a short facilitation by an expert facilitator, and in some cases, there may also be an expert panel to add diversified practitioner perspective.

1 SOUTHERN AFRICA STRUCTURED TRADE SEMINAR THE FINANCE AND RISK MANAGEMENT OF COMMODITY TRADING JUNE 2018, LIVINGSTONE, ZAMBIA Draft Program Introductory Note on Format: The Seminar is structured to be as interactive as possible, giving all participants opportunity to develop skills through hands-on learning by doing, and contributing their own views and experience. In the main work sessions, with a large number of participants in the room, it will be difficult to engage many participants directly. Accordingly, in these sessions, participants will be seated at round tables and assigned a specific table to ensure a mix of stakeholder interests at each table. Each of the main work sessions will start with a short facilitation by an expert facilitator, and in some cases, there may also be an expert panel to add diversified practitioner perspective. A significant proportion of each main work session, however, will take place at the round tables where participants are invited to perform interactive exercises, and engage in discussion and debate, with the table as a whole reporting back with questions and conclusions. There are also two periods during the Seminar set aside for interactive break-out sessions. These sessions are stakeholder-specific across six workstreams policymaker, agribusiness, financier, investor, inclusivity and metals sector. For the breakouts, the rooms will be less full and seating will be open. However, these sessions are to be equally participative, with a strong focus on practical engagement and open discussion.

2 After the Seminar, a report will be prepared for dissemination to stakeholders documenting the discussions, issues raised and conclusions and recommendations reached in the course of the Seminar. Rapporteurs will be allocated to capture points raised during table discussions and feed them into the report. All reporting will be done under Chatham House Rules, so participants will be free to speak openly without their comments being specifically attributed. Day 1 Tuesday 26 th June Registration Welcome Cocktail Day 2 Wednesday 27 th June :30-10:00 Welcome, Opening Remarks and Introduction Main Work Session 1: Moving from Physical to Structured Trade - the Fundamentals 10:00-11:00 Content: A review of the essential components and major benefits of a trading eco-system where commodities of all types are traded in scale on a sight unseen basis, without need for cash settlement. Outcomes: Participants are aware of the environment needed for structured trading to thrive, the role of the different stakeholders within that environment, and the major benefits to be realized. 11:00-11:30 Coffee Break Main Work Session 2: Standards, Custody and Commodity Exchanges 11:30-13:30 Content: Oversight of the essential role of standards and custody in trading all classes of commodities and the role a commodity exchange plays in providing price transparency, market liquidity and the clearing and settlement of trade Outcomes: Participants are conversant with the essential market infrastructure that provides for market integrity and trading confidence 13:30-14:30 Lunch

3 Work Session 3: Commodity Exchange B2B Trade Facilitation - Southern Africa 14:30-15:30 Content: Regional commodity exchanges facilitate suppliers across the region to link to pan-regional buyers, creating regional price discovery and regional trade flows, including explanation by expert panel of proceedings and implications. Outcomes: Participants understand the function and status of regional commodity exchanges, understand the value and visualise the realization of price discovery as a foundation for intra-regional trade and regional integration, and build consensus on further steps that can enhance regional integration through structured trade. 15:30-16:00 Coffee Break First Break-Out Sessions: 1. Agribusiness Workstream Workshop on Accessing Investment Content: A technical workshop on how agribusiness can prepare appropriate materials and documentation to positively engage with investors for accessing investment 16:00-18:00 Outcomes: Agribusiness have better preparedness to successfully engage with investors 2. Financier Workstream - Commodity-Backed Finance / Warehouse Receipts: Content: A detailed how to technical workshop for financiers and agri value chain participants covering key commodity and trade finance structures, building on the previous session, demonstrating how commodity exchange, derivative and warehouse receipt instruments enable new product and business development. Outcomes: Participants develop enhanced technical capacity for structuring commodity finance solutions so that lenders and borrowers can realize the essential benefits from structured trade.

4 3. Investor Workstream - Commodities Investment Environment and Opportunities: Content: Interactive practitioner-led discussion of opportunities, challenges and solutions for agri- and other commodity investments in the region, with focus on blended finance solutions to capitalize on multi-stakeholder participation. Outcomes: Participants understand concepts and identify opportunities for blended agri-finance and investment in Southern Africa, including the role of blending partners such as USAID and institutions across the development finance, impact, donor and philanthropic spaces. 4. Inclusivity Workstream - Structured Trade for SMEs and Farmer Groups Aggregator Finance, Market Access and Inclusivity: Content: Workshop on mechanisms enabling SMEs and farmer organizations to participate in structured trade opportunities, using practical examples to illustrate opportunities in Southern Africa. Outcomes: Participants have improved awareness of and readiness for SME- and farmer-friendly solutions to realize the benefits of structured trade. 5. Policymaker Workstream - Policy and Regulatory Enablement Best Practices: Content: Best practice case studies identifying the dos and do-nots in formulating a government policy that allows structured trade and the related finance and investment benefits to thrive, and the essential role of regulation to maintain market integrity and confidence. Outcomes: Participants from the policy and regulatory communities have access to a roadmap for realizing opportunities and mitigating risks associated with structured trade.

5 6. Metals Sector Workstream - Structured Trade in the Metals Sector, Part I: Content: An interactive exploration of structured trade instruments, platforms and opportunities accessible to the mineral sector. Outcomes: Participants understand the opportunities for structured trade in the Southern Africa metals and minerals sector. 18:00-18:30 Day 1 Plenary 19:00-21:00 Cocktail Day 3 Thursday 28 th June 2018 Launch of JSE/ZAMACE Zambia-Deliverable Grain Futures Contract, followed by Live Trading Sesssion from the Seminar 08:00-09:15 Content: Build up to discuss the historical importance and implications of the contract as the first futures contract in Africa outside South Africa, and the first JSE contract priced in USD and deliverable outside South Africa, followed by ceremonial launch, and live trading session from Zambia as market participants take market positions and execute trades (to confirm) Outcomes: Launch of the contract and live trading onto the JSE platform from Zambian market participants hedging their price risk in three value chains maize, soyabean and wheat; signature of MOU between JSE and ACE (to confirm) Main Work Session 4: Day 1 Review and Consolidation, and Introduction to Day 2 09:15-10:00 Content: Participants will work in groups to build on and reinforce recognition of vital realizations from the first day, sharing their own perceptions and learning. Outcomes: Participants highlight and reinforce learnings from the first day and reinforce fundamental understanding of key concepts. 10:00-10:30 Coffee Break

6 Main Work Session 5: Risk Management and Commodity Finance - An Introduction to Derivative Products and the Role they Play in Managing Risk 10:30-12:30 Content: Exploration of how derivative instruments evolve and work, identifying futures, options and other alternatives to building an appropriate risk management strategy; and identifying the division of labour between a client and its broker to show that the client need mainly to articulate its need, and the complexities associated with structuring and execution of derivative strategies can be absorbed by the broker, also known as risk management consultant. Outcomes: Participants recognize how structured markets create opportunity for price risks to be managed, enhancing stability and confidence along value chains and in commodity and financial markets; participants including policymakers, agribusiness, banks, SMEs and farmer groups understand that successful use of derivatives instruments is not reserved only for rocket scientists! 12:30-14:00 Lunch Main Work Session 6: Trading Simulation 14:00-16:00 Content: Working in teams, participants are exposed to market scenarios in which they make their own decisions about whether and how to implement a risk management strategy, reacting to market events and evaluating the outcome of their team decisions against the approach adopted by other teams. Outcomes: Participants gain practical experience and confidence in using the tools of risk management and how to benefit from them; 16:00-16:30 Coffee Break Main Work Session 7: Trading Simulation Review and Awards 16:30-17:30 Review of the simulation; Presentation of concepts to take forward the learning and network opportunities beyond the Seminar. 17:30-18:30 Day 2 Plenary 19:00-21:00 Dinner

7 Day 4 Friday 29 th June :30-09:00 Welcome, Opening Remarks and Recap from Day 2 Second Break-Out Sessions: 1. Agribusiness/Investor Workstreams Investment Matchmaking: Content: Agribusiness and minerals sector entities with business and investment plans prepared for the event under guidance from the Hub will be matched with investors from across the banking, private equity, venture capital, development finance and impact investor landscape. Outcomes: Investors build understanding and readiness to take forward appraisals, identifying blending requirements from USAID and other blending partners. 2. Policymaker Workstream Regional Integration, Global Linkages and AGOA: 09:00-12:00 Content: Policymaker discussions on policy and non-policy mechanisms to improve access to regional and global opportunities around structured trade. Outcomes: Policy communiqué and roadmap (to be confirmed) 3. Financier Workstream Professionalizing Africa s Warehousing Sector Content: Many African countries lack professional third party-warehousing industries, contrary to other developing regions an impediment to structured trade, particularly pronounced in rural areas. Global case studies will inform multi-stakeholder solutions development covering areas including investment, regulation, standards, capacity, and insurance. Outcomes: Participants put in place a high-level roadmap to drive the creation of a professional warehousing industry in the region.

8 4. Agribusiness Workstream Regionalizing the Southern African Seed Sector Content: The SADC Seed Harmonization framework provides an important foundation for delivering improved productivity and resilience in regional value chains. The session will identify the structured trade and blended financing solutions required to support seed companies. Outcomes: Participants identify within-country and regional partnerships, investments and structures that can unlock benefits to the seed sector from structured trade and related financing opportunities. 5. Inclusivity Workstream - Agri-SME Finance and Investment Planning: Content: An expert-led capacity-building session to guide agri-smes on how to establish bankability and build capacity to apply for and manage short-term and long-term finance and capital investment. Outcomes: SME participants build understanding of the steps required to create investment readiness. 6. Metals Workstream - Structured Trade in the Metals Sector, Part II: Content: An interactive exploration of structured trade instruments, platforms and opportunities accessible to the mineral sector. Outcomes: Participants understand the opportunities for structured trade in the Southern Africa metals and minerals sector. 12:00-13:00 Final Plenary and Awards 13:00-14:00 Lunch 14:30-17:30 Livingstone Sightseeing

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