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Monday, 16th February 2004 (8593 views)

The Dubai Development and Investment Authority (DDIA) has announced a Memorandum of Understanding (MOU) with the New York Mercantile Exchange (Nymex) to look into developing the region's first commodity futures exchange.<BR/><BR/>The joint study will focus on the creation of new and differentiated products, primarily revolving around commodities such as precious metals, including gold.<BR/><BR/>Called Dubai Mercantile Exchange (DME), the new exchange would make Dubai a trading hub and establish a futures market in the Middle East. <BR/><BR/>Plans include a trading floor and clearinghouse, alongside the establishment of a training institution and a series of internships for excellent candidates on Nymex's trading floors in New York. <BR/><BR/>Mohammed Al Gergawi, chairman of the board of DDIA, said: 'Trading has always been at the heart of the Arab world and is a key driver behind the Dubai Mercantile Exchange. Every major trading hub worldwide has developed a commodity exchange except for the Middle East, which is home to 65 per cent of the world's crude oil and 40 per cent of the world's natural gas reserves.'<BR/><BR/>Vincent Viola, chairman of Nymex stated: 'The DME will enable the region to become a serious player in the world's energy and commodities markets, creating greater efficiency and providing a mechanism for managing risk in a well structured trading environment.' <BR/><BR/>Building on the strong financial regulatory structures being established by the Dubai International Finance Centre ('DIFC'), DME could play a leading role in attracting the world's leading commodity players to the Middle East as well as boosting associated trades such as jewellery.

 

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