All of this should happen organically. None of the traders will need exhortation to offer better terms to the layer of traders below them. It’s a function of each layer having more product to move, and by the interaction of supply and demand, the terms on offer will adjust automatically.

I’ve seen similar interactions growing up in Dubai in the 1980s, embedded within the trade community. More supply of product in a market that demands it, inevitably means that buyers will gradually enjoy better terms from sellers, with the result that everyone does more business, and makes more money.

Freeing up household budget

Anecdotally, the prices for staples (such as rice, cooking oil, etc) across many African markets are higher than in many developed markets, especially when we normalise for purchasing power parity. Part of this differential is a function of higher cost to transport goods far inland. But a large part of the differential comes simply from not enough product being supplied.

As Kommerce facilitates increased product flow into these markets, we expect the increased supply of staples to put downward pressure on the prices for staples. This will free up household budget for spending on other items, such as better quality calories, education, health, transport, communications and other things.

In this way, we build robustness and resilience in a population and an economy.

Validating these hypotheses

Data will ultimately help us validate the results of this approach. That’s why Kommerce has engaged SocialCops as a key partner in this.

SocialCops is among the leading companies in the world in gathering, organising, understanding and getting insights from data.

We want to understand the impact of increasing trade flows, on indicators such as employment, health, household wallet, and others, and understand the web of connections that map the impact on a society of improved prosperity. Having that kind of industry leading expertise to help us get a handle on the data is a key first step in achieving this.

Realising a better world through trade

If the data bears out our hypotheses, Kommerce will have hit upon a way to address poverty systematically and meet the challenge of equitable development for all.

The next steps would then be to build complexity models founded on the data, to better predict the impact of introducing trade finance into target areas, and using these to make a compelling case for pools of capital to be diverted to supporting trade. We’re thinking ahead and have identified emerging leaders in complexity science to work with as the data starts flowing.

There is still a long road ahead to realising the impact, but these things are worth doing, and we’re committed to doing them.