CSE, MCX sign agreement for first commodity exchange in Bangladesh
Chittagong Stock Exchange Ltd (CSE) and Multi Commodity Exchange (MCX) have signed an agreement to set up the first commodity exchange in Bangladesh.
A press conference was held in this regard on Monday.
Establishing an automated and structured commodity exchange linked to the evolution of sustainable economic development, massive macroeconomic growth and immense infrastructural development is crucial for Bangladesh, reads a press release.
A commodity exchange is an organised marketplace where buyers and sellers come together to trade commodity related contracts following rules set by the exchange.
The commodity exchange may enable buyers and producers to buy and sell goods at competitive prices and reduce the scope of manipulation in the commodity market now alleged to have been rampant in domestic trades.
Through establishment of commodity exchange there will be benefits for numerous stakeholders - reduction of post-crop losses through price stabilization from farmer/producer to end user, improvement of commodity price risk for both locally produced and imported supplies, efficient debt risk management, a transparent and competitive price discovery system, and reduction of transactions and marketing costs.
As per the existing securities laws in Bangladesh, Commodity Exchange may be formed and regulations of business of Commodity Futures Contracts may be made with the approval of Bangladesh Securities and Exchange Commission (BSEC). Section 2(ccc) & (l) and Section 32A of the Securities and Exchange Ordinance, 1969 which allows or gives such authority to BSEC, reads the release.
