CSE gets commodity exchange licence

State Minister for Commerce Ahsanul Islam Titu recommended the Chittagong Stock Exchange include products such as potatoes, soybean oil, palm oil, and raw sugar in the commodity exchange when it is launched.

A commodity exchange is a legal entity that determines and enforces rules and procedures for trading standardised commodity contracts and related investment products.

While neighbouring countries like India, Nepal and Pakistan have had a commodity exchange for a long time, Bangladesh is hoping to launch it for the first time within this year.

Titu made the comment at an event yesterday at the Bangladesh Securities and Exchange Commission (BSEC) office in the capital's Agargaon, where he handed over a commodity exchange licence to the CSE.

Titu said there are cold storages to preserve potatoes, so it is possible to include it in the commodity exchange. "On the other hand, we import a majority of edible oil and raw sugar from abroad. These can also be included in the exchange," he said.

The commodity exchange will play an important role in the country's business in the coming days, he added.

In 2022, the CSE planned to launch the country's first commodity exchange with the aim to reduce difference between prices paid by consumers and producers.

Asif Ibrahim, chairman of the CSE, hoped to officially launch Bangladesh's first commodity exchange later this year.

"Work related to hardware and software procurement is progressing well," he said.

Asif said Bangladesh's economy is worth half a trillion dollars, but there is no structured commodity exchange. In countries like Nepal, commodity exchanges have been operational for the last ten years, he added.

"Finally, CSE is proud to have obtained the commodity exchange licence. It's a befitting honor for us," he said.

"We have seen through the media that middlemen have taken advantage of the big gap in prices between the farming and consumer level," he added.

Hopefully, this problem will be resolved through the launch of commodity exchange, Asif added.

Professor Shibli Rubayat-Ul-Islam, chairman of BSEC, said commodity exchanges already exist in many developed countries, but this component has been missing in Bangladesh.

For countries who give importance to import and export, a commodity exchange is very important, he said.

Through commodity exchanges, the role of middlemen will be reduced. Consumers will be benefitted, he said, adding that problems of over invoicing and under invoicing will be solved.

Business will become much easier, he hoped.

Traders can easily buy and sell by knowing the price of products in any country of the world, he said, adding that with the handover of this licence to the CSE, the country's trade will gather a new momentum.

SOURCE : The Daily Star