Arba Minch University: ICT Contribution in Ethiopia Commodity Exchange

This research proposal, submitted by a Master's student at Arba Minch University, explores the contribution of Information and Communication Technology (ICT) to the Ethiopian Commodity Exchange (ECX). The study aims to investigate how ICT supports the ECX's operations and its clients, focusing on challenges like website usability, communication issues, and operational costs. Using a descriptive case study approach with questionnaires and interviews, the research seeks to evaluate the impact of ICT applications on commodities exporters. The proposal highlights the novelty of intensive ICT technologies in the Ethiopian commodities market and identifies a research gap in understanding the changes and contributions of ECX to the country's commodities sector. The study will address the role of ICT in the commodities sector, the specific ICT applications within the ECX, and the opportunities and challenges faced by exporters. The research will contribute to the existing literature on ICT in the public sector and provide valuable insights for the ECX, exporters, and other stakeholders involved in developing effective ICT systems in the Ethiopian commodity market.

ARBA MINCH UNIVERSITY INSTITUTE OF TECHNOLOGY
SCHOOL OF GRADUATE STUDIES
FACULTY OF COMPUTING AND SOFTWARE ENGNEERING
RESEARCH PROPOSAL IN COURSE OF RESEARCH METHODOLGY
Assessing the Contribution of ICT in Ethiopia Commodity Exchange
Prepared by:
Name ID email
1.
2.
3.
MSc scholar, AMUIT, Ethiopia,
Submitted to: Dr. D.P Sharma (Prof)
Arba Minch, Ethiopia
Jan 2020

Abstract
Information and Communication Technologies (ICTs) have become a major factor in social and
economic development of the society. The most commonly perceived barriers felt by ECX are
the website that are not user-friendly, unable to know the stock positions at the exchanges hand,
frequent communication breakdown and interruptions, and increased operational costs are among
the problems. The main objective of this study is to investigate the contribution of Information
and Communication Technology to the public sector, with a particular emphasis on the Ethiopian
Commodity Exchange. The study evaluated the how application ICT support its various
operations and its clients. Descriptive case study research method is used, and it applied
questionnaires and interviews as a data gathering instruments. Data were acquired through
questionnaires to evaluate the contributions of the ICT application in the ECX due to
opportunities and challenges created to commodities exporters. The research adopted mainly
qualitative data analysis. The application of intensive ICT technologies in the Ethiopian
commodities market is a new and recent experience. It has not been explored well and the
researcher considered this as a major research gap. Hence, exploring what contributions and
changes the ECX brought to the county’s commodities sectors. The Government of Ethiopia is
the owner of the ECX, and it is established as public enterprise in 2007 under the proclamation
No. 550/07. In the context of this study ICTs was found to be contributing the Ethiopian
commodities market in its application of various technological support systems that facilitates
the daily transaction activities of its own and exporters various operations, enhancing decision-
making capacity and create an opportunity for a smooth and faster clearing and settlement of
transactions. Using Ed-Raw Max for Design and MS Form to questionnaire analysis and
collections then finally, assessing the contributing of ICT in the domain that overcome the
problem faced.
Keywords
Commodity Exchange, Contribution, Transaction, Proclamation, ICT
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Table of Contents
Abstract...................................................................................................................................................ii
Chapter One................................................................................................................................................1
1 .Introduction.............................................................................................................................................1
1.1 Background........................................................................................................................................1
1.2 Statement of the Problem.................................................................................................................2
Research Questions.....................................................................................................................................3
1.3 Objectives of the Study......................................................................................................................3
1.3.1 General Objectives...............................................................................................................3
1.3.2 Specific Objectives......................................................................................................................3
1.4 Significance of the Study....................................................................................................................4
1.5. Review of Related Literature............................................................................................................4
Review of Concept literature...................................................................................................................4
1.6 Research Method...................................................................................................................................6
1.6.1 Instruments for of Data Collection..................................................................................................6
1.6.2 Tools Selection........................................................................................................................7
1.7 Scope and Delimitation of the study......................................................................................................8
1.8. Beneficiaries.........................................................................................................................................8
1.9. Budget/ Cost breakdown.......................................................................................................................8
1.10. Work breakdown structure /WBS.......................................................................................................9
Bibliography...............................................................................................................................................10
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Lists of Figure
Figure 1: Data Collection............................................................................................................................6
Figure 2: Tool Selection Methods...............................................................................................................7
Acronym
ICT- Information Communication Technology
ECX- Exchange
No- Number
MS- Micro Soft
Chapter One
1 .Introduction
1.1 Background
The emergence of information communication technologies has brought a lot of changes to the
way things are done in the world. These changes are across the spectrum; the way private
companies do business, the way universities do things, the way governments provide services to
their citizens and the way they interact with stakeholders at large. Public sector is increasingly
seen as the main engine to bridge the digital divide at country level. Public agencies can start
acting as model users of ICT and be catalysts for others to follow. The public sector tends to be
the biggest provider of local content and it can nurture and foster the further development of the
local ICT industry. ICT is viewed as a complex process, articulated over time, embracing the
overall systems in which information; communication and technology operate and interact with
individuals, organizations and communities to perform their functions, achieving public ends by
digital means. ICTs have proven to be indispensable tools in the sharing and dissemination of
knowledge. The degree to which ICTs have aided information access is simply extraordinary. A
fair, proper and equitable use of ICTs certainly will enable the widest distribution of information
and knowledge across the board to as many people as possible.
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The term information and communication technologies‟ (ICT) can be used to embrace a
multitude of stand-alone media, including telephone, television, video, tele-text, voice
information systems and fax, as well as those requiring the use of a personal computer fitted with
a modem. The latter can include direct dial-up services such as electronic banking, file exchange
and closed information services. [ICT]… tends to concentrate on the ubiquitous internet and its
associated services, including electronic mail (email), electronic bulletin boards and the World-
Wide Web (WWW) [1]. For over a decade ICT has come to dominate daily life around the globe.
Whether it is for financial information, markets, news, general knowledge or simply
entertainment, the ease and speed of communication has grown phenomenally [2]. In an attempt
to solve different problems of traditional commodity market operation and its subsequent
drawbacks, the government of Ethiopia allowed the launching of Ethiopia Commodities
Exchange in January 2008. Initially the Ethiopia Commodity Exchange launched trading
operations with contracts for white and mixed maize, hard and soft wheat, processed -
unprocessed haricot beans and began trading coffee in December 2008 (ECX, brochure). The
exchange uses different ICT infrastructure to achieve its objectives. The infrastructure would
enable it to provide market information, to facilitate various operations, and to meet its duties
using different technologies and to meet the expectations of its clients. As mentioned by [2]. ICT
can bring unprecedented potential to deliver information, provide links to markets and much
more [3]. The purpose of this study is to assess the contributions of ICT to the operations of the
ECX, and how the application of ICT by the exchange is perceived by exporters.
1.2 Statement of the Problem
Seventy five of developing countries‟ population lives in rural areas, and of these the vast
majorities are small-scale farmers, who contribute significantly to the economy yet remain as the
poorest [4]. If this is to improve then knowledge and information are critical, and application of
ICT in the public sector should be included in any poverty alleviation program. As per study
show ICT can provide two basic services in the commodities trading sector: market information
and agricultural information. ECX introduce ICT in the trading system and its different
operations since its formation. The ICT technologies include market information tickers, mobile
phone Short Messaging Service (SMS), Interactive Voice Response (IVR) service, and Website
(www.ecx.com.et) (http://www.ecx.com.et/Operations.aspx#RM). Moreover, the exchange
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applies ICT in its various operations at different degrees and magnitudes to facilitate its activities
and communicate with different stakeholders.
However, regardless of ICT‟s basic benefits, Ethiopian agricultural sector suffers from low level
of productivity and absence of sound ICT system. ICT‟s application is at its minimal state, it is
characterized by insufficient market information provision, poor quality of service and
accessibility, unstable price, lack of trust among trading partners, and uncoordinated markets.
The lack of market information is characterized by highly fluctuating prices and huge price
overhead on the consumers. Farmers are getting only a small portion of the profit margin due to
the existence of multiple brokers at every stage of the market chain (Assegid, 2010). The
Government of Ethiopia is the owner of the ECX, and it is established as public enterprise in
2007 under the proclamation No. 550/07. After its formation, the ECX is expected to provide
solutions for the problems mentioned earlier. So, to bridge the gap between the need for
comprehensive ICT application and the actual problems on the ground the exchange applied
different types of ICT tools in its various operations to communicate with its partners. The
application or introduction of intensive ICT technologies in the Ethiopian commodities market is
a new and recent experience. It has not been explored academically and the researcher
considered this as a major research gap. Hence, in this research I explored what contributions
and changes the ECX brought to the county’s commodities sectors. Due to these factors, the
research evaluate the contributions of ICT in the ECX‟s activities after the formation of the
exchange in 2008 in regard to the application of ICT in commodities market information
delivery, which have been in low level of technological application for long period of time, and
to investigate what benefits and challenges the ICT application created need to be addressed. In
addition, the research needs to assess the effectiveness of the system in addressing
communication related challenges.
Research Questions
In this study attempts will be made to answer following questions:
1. What is the role of ICT to the commodities sector, especially to the ECX?
2. What are the contributions of the application of ICT to the operations of the ECX?
3. What are the opportunities and challenges that exporters face as a result of the exchange’s use
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of ICT applications?
1.3 Objectives of the Study
1.3.1 General Objectives
The general objective of this study is to investigate the contribution of ICT to the ECX‟s
complex operations, and what opportunities and challenges its members, particularly exporters,
face due to the application of ICT by the ECX.
1.3.2 Specific Objectives
 To investigate the role of ICT to the commodities sector
 To investigate the operations applying ICT at the exchange,
 To investigate the pre and post commodity market information dissemination
processes - from the ICT perspective
1.4 Significance of the Study
The research gives detail information on how ICT is contributing in the ECX‟s various
operations. It also shows how ICT is important to tackle the long standing commodities markets
challenges and problems like lack of sufficient market information, lack of trust among trading
partners, delayed delivery of purchased commodities from regional warehouses due to
infrastructural issues, increased transaction costs etc. It point out factors that affect exporters due
to low level of ICT application challenges in infrastructure problems of the country. It also looks
at how e-governance could support the public sector in enhancing services and products it offers
to the public. The findings of the study will benefit the exchange, exporters, and different
organizations that have a stake in the developing effective ICT system and for those who want to
Involve in the sector in the future. The research can also contribute for similar areas of study.
Furthermore, it can also serve as addition to existing literature of application of ICT in the public
sector.
1.5. Review of Related Literature
Review of Concept literature
In order to Support this proposed research study and achieve the aim of this research, several
previously done related research literature and Salient concepts (books, articles, and journals) are
reviewed. The researcher systematically reviewed related material thus to understand and
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analyze the knowledge gap between the haves and have not’s a solution and to elaborate the
scientific concepts related to this research and critically relate, and evaluate the researches done
prior to this study. Researcher tried to find a clear-cut research gap of ICTs service in the area of
the commodity market of Ethiopia.
The reviewed papers are evaluated and prioritized base on some parameters; Relevancy to the
research domain, Quality of Journal, the year of their publication etc.
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Proposal Paper Page 9
S.
No
Authors &
Year
Title & Journal
Name/Conference
Name
Major Findings
/Contributions &conclusion
Critical Remarks to find
out research ability gap for
the proposed research
1 Eggleston,
K., R.
Jensen, and
Zeckhauser,
R. 2002
Information and
communication
technologies, markets,
and economic
development
Explanations for the existence
of
commodity exchange markets
and the role of ICT in the
development of technology
process to enhances the
function of the Markets.
The research study is
relevant to the proposed
research but the researcher
focused generally in the
announcing of the ICT in the
Market rather how it
contribute in the market
demand challenges
2 World
Bank, 2002
Building Institutions for
Markets. New York:
Oxford University Press.
The paper the current discourse
on development seeks to
emulate the institutions of the
few societies that have achieved
the mobilization of ICT
innovation to sustain economic
growth through competitiveness
in global markets
This work done is proposed
study but researcher focused
only to explains the extent
that social change is
understood to be implicated
in the dynamic linking of
technology innovation and
an effective market
economy.
3 World Bank
Group,
2011
World Bank Information
& Communication
Technologies Sector
Strategy.
Researchers examined the
information and communication
technologies (ICT) sector has
seen a rapid development since
the last ICT sector strategy
The research study is
relevant to the proposed
research but the researcher
focused on commodities
exchanges applied various
ICTs technologies to be
more competitive and
enhance their marketing
shares and profitability.
4 MCIT,
2014
Information &
Communication
Technologies Sector
Development in Ethiopia
Researchers considered the
government shall actively
collaborate with the private
sector, civil society
organizations and communities
to promote and encourage the
use of ICT towards transforming
Ethiopia to a knowledge and
information age. The policy also
promotes the necessary
coordination to establish
cooperative practices and spirit
amongst various stakeholders
for a cost-effective development
of ICT.
The Researcher aims only
for endorsed and currently
enforced ICT policy is a
demonstration of its
commitment to the
development of ICT both as
an industry and as an enabler
of socio-economic
transformation.
5 Avgerou, C.
2003
The link between ICT
and economic growth in
the discourse of
development
Researchers explain the existing
capacity of ICT in the socio-
economic fabric is considered a
condition of readiness for
further ICT development
through network-based
activities.
Researcher focused the
diffusion of ICT in all
sectors of the economy and
society together with the
liberalization of the
telecommunications sector,
are set up as desirable policy
targets in their own right.

1.6 Research Method
This proposed studies aims to assess the contribution of ICT to the Ethiopia commodity
exchange operations, and what benefits and challenges the ICT application created are addressed.
We use a descriptive case study to obtain the necessary information.
1.6.1 Method of Data Collection
The main data gathering instruments used in this study was questionnaires and interviews. In
order to triangulate facts, and enrich the data, interview was conducted with responsible officers
at the ECX and MCIT and further document analysis was conducted.
.
Figure 1: Data Collection
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Data collection steps
Primary data
source
Secondary Data Source
Technical Observation
Observing how tasks performed
Observing how resources are stored in store
Observing all ICT infrastructure power utilizations
commodities exporters
Interviewing
Chief info/n_ officer
ICT experts
Documents
Development of
strategic
Prototyping,
modeling& drew
Data
compilation,
Policy manuals
Annual report
Strategic plan doc.
Questioners
1 2
1.1
1.2
1.3
2.1
ICT Officer

1.6.2 Tools Selection
To conduct the proposed research Study, different software and designing tools are proposed to
be selected using the most-fit strategy using parametric analysis. The researcher tried to focus on
Open Source and online tools for data collection, analysis and designing the Framework,
Prototyping and validating. The researcher selects the following tools from different possible
tools using systematic tool selection criteria’s and detailed selection method attempt to
mentioned in the following figure below.
Figure 2: Tool Selection Methods
1.7 Scope and Delimitation of the study
The scope of this study is delimited to the analysis of the contributions of ICT to the public
sector in a case of the ECX. In addition to that the proposed study investigates the opportunities
and challenges the ICT application creates to its exporters members. The study is covers periods
from the 2012 to 2013 fiscal year, since the formation of the ECX as a public institute under the
supervision of the Ethiopian Commodity Authority which was formed by the official judgment
of proclamation No. 550/07. It will exclude farmers and other stakeholders and only limited to
exporters of commodities traded at the exchange.
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1.8. Beneficiaries
The beneficiaries of the proposed research study are: -
 Citizen of Ethiopia
 Government of Ethiopia
 Researchers.
1.9. Budget/ Cost breakdown
A budget Breakdown Structure (BBS) is a cost allocation to the lowest level of the
Work Breakdown Structure (WBS). The CBS is a breakdown of the costs of the various
components of the structure including all works or services done by the subcontractors [5]. Based
on this cost breakdown for this proposed study is as follow.
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Figure 3 Cost break down
1.10. Work breakdown structure /WBS
A WBS provides a common framework for the development of planning and control of a
contract and basis for dividing the work into delineable increments from which the statement of
work can be developed and technical, schedule and cost and labor hour reporting can be
established.
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A work-breakdown structure (WBS) in project management and systems engineering, is
a deliverable-oriented breakdown of a research project into smaller components.
A work breakdown structure is a key project or research deliverable that organizes the tasks
to into manageable sections. Hence for this proposed study WBS is as follow.
Figure 4 work breakdown
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