Transcript: The Moving Parts of a Market

NARRATION: ELENI SPENT 2 YEARS ASSEMBING ALL THE MOVING PARTS OF A TRADING SYSTEM SPECIFICALLY TAILORED TO THE NEEDS OF ETHIOPIAN AGRICULTURE.

ELENI GABRE-MADHIN (VO) By now we’ve got a lot of pieces in this puzzle. There’s the warehousing, there’s the quality, there’s the information system, there’s the payment, and at the core of it there’s the trading.

NARRATION: THESE ARE ALL THINGS THAT DEVELOPED COUNTRIES, WITH THEIR DEVELOPED INFRASTRUCTURE, TAKE FOR GRANTED.

BEN ASCHENAKI (VO) We’re designing everything from scratch. If you look at other exchanges, they don’t have to worry about warehouse; they don’t have to worry about grading. All that stuff is either outsourced or it’s not needed, but in Ethiopia we can’t do that.

NARRATION: ON APRIL 24TH 2008, ELENI REALIZED THE FIRST BIG STEP IN HER MONUMENTAL VISION… THE OPENING BELL RANG ON THE ECX.

ELENI GABRE-MADHIN (VO) The core idea of ECX is getting people who want to sell in the same place with people who want to buy.

KENA GOBENA (SUBTITLE – AMHARIC) It’s a modern way of trading. The quality is controlled. You sell today and get paid tomorrow.

AARON BROWN Show me your world.

ELENI GABRE-MADHIN This is the trading floor, the trading pit.

TRADER (SUBTITLE) 325…329…321…

ELENI GABRE-MADHIN As you can see, it’s very active.

AARON BROWN This is very intense right now.

ELENI GABRE-MADHIN So the guys wearing the khaki jackets are the buyers. The green jackets are the sellers. It’s a market. There are people, you know, hungry to make a trade. They’ve got, you know, debts to repay. You’re trying to buy low and sell high. That’s basic market economics.

AARON BROWN Yes, it is, isn’t it.

NARRATION: BUILDING THE TECHNICAL INFRASTRUCTURE WOULD BE VERY HARD. BUT HARDER STILL – GETTING PEOPLE TO GIVE UP CENTURIES-OLD TRADITIONS AND JOIN A COMPLICATED NEW SYSTEM, EXCHANGING CARTS AND DONKEYS FOR AN ELECTRONICALLY-MONITORED TRADING PIT. IF THEY COULDN'T BE PERSUADED, THEN ELENI'S DREAM WOULD LIE IN TATTERS.

ELENI GABRE-MADHIN (SUBTITLE – AMHARIC) Why don’t you get into the ECX and sell there?

TRADER 1 (SUBTITLE – AMHARIC) What is that?

ELENI GABRE-MADHIN (SUBTITLE – AMHARIC) The Ethiopia Commodity Exchange. Have you heard of it?

TRADER 1 (SUBTITLE – AMHARIC) Where is it?

ELENI GABRE-MADHIN (SUBTITLE – AMHARIC) Across from the Phillips Building.

OK, are you guys going to join? We make it really easy to be a member of the ECX.

TRADER 2 (SUBTITLE – AMHARIC) - That’s possible.

ELENI GABRE-MADHIN (SUBTITLE – AMHARIC) - Yeah?

TRADER 2 (SUBTITLE – AMHARIC) I’ll propose the idea and talk to some people.

ELENI GABRE-MADHIN (VO) People are legitimately nervous about change. Because it’s the unknown and this is a big part of their personal livelihoods, so there’s a good amount of fear of the unknown.

BEN ASCHENAKI You know, we are changing the way things have been done, like, forever.

NARRATION: WHICH IS EXACTLY WHAT ELENI AND HER TEAM ARE TRYING TO DO. VIRTUALLY TO A PERSON THEY HAVE GIVEN UP EASIER LIVES IN MORE COMFORTABLE PLACES TO COME HERE AND DO THIS.

NARRATION: BEN ASCHENAKI IS THE HEAD OF ECX BUSINESS DEVELOPMENT. BORN IN ETHIOPIA, BUT RAISED IN THE U.S., HE’D LANDED A FANCY FINANCE JOB IN HOUSTON – THE GOOD LIFE – WHICH HE EXCHANGED FOR THE HARD LIFE BACK HOME IN 2007.

BEN ASCHENAKI (VO) You know, I’ve always worked to enhance shareholder value. You know, I was a corporate guy. But like if you ask me what I’m doing here, we’re changing things. You know, we’re making a fundamental difference in our country. What makes this exchange unique is who we’re all here for. It’s the farmer, it’s the small-holder farmer. I think this is an exchange based on the little guy.

NARRATION: THE LITTLE GUY – THE MILLIONS OF SMALL FARMERS WHO CULTIVATE ONLY A COUPLE OF ACRES – LIVES A WORLD APART FROM THE ECX. FOR THEM, A STANDARD GRADING SYSTEM FOR THEIR CROPS OR TRANSPARENT PRICING FOR THEIR HARVEST IS BEYOND IMAGINATION. THEY ARE LOCKED IN A LONG AGO YESTERDAY FROM WHERE IT’S HARD TO EVEN CONCEIVE OF A TOMORROW.

AARON BROWN Is farming a hard way to make a living? Is it hard work?

MEKONEN MOTBAYNOR (SUBTITLE – AMHARIC) It’s difficult. A farmer, like a woman giving birth, never tires in labor. The farmer toils night and day. He does not eat and drink as he wishes, does not bathe, and is prone to illness that can shorten his life.

AARON BROWN Do you think that there’s a way to make a farmer’s life easier, so that prices don’t go way up one year, way down another year…so there’s not so much fluctuation?

MEKONEN MOTBAYNOR (SUBTITLE – AMHARIC) In the market prices go up and down but nothing can be done for the farmer.

AARON BROWN Have you noticed any difference because of the commodities exchange? Has it changed anything?

MEKONEN MOTBAYNOR (SUBTITLE – AMHARIC) What do you mean by commodities exchange?