States contract heavy debts with traders, the grandmasters of the globalization of commodity markets. According to the IMF, commodity prepayments have brought Congo and Chad and other African countries to the edge of the precipice

Commodity trading seems to have a bright future ahead of it as the practice continues to expand its tentacles. The denunciation by the IMF of these highly profitable deals for traders — with interest rates between around 8% and 10%, according to specialists — has created a debate on the continent

Many sovereignist observers do not understand that their states contract heavy debts with traders who charge high interest rates.

The principle of these deals is simple: they are a loan granted by a trader, which is repaid to him “in kind” by shipments of oil or minerals, drawn from the future production of the contractor, usually a State or the national extractive company. It is the merchant — not the borrower — who structures the credit for the operation, taking advantage of his good relationships with bankers in Geneva, London, Paris or New York, where his reputation is

It is crucial that governments and national extractive companies acquire the right expertise before signing agreements with traders.