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Commodity Exchange (CX) will help increase diversification of products and ensure fair pricing required to contain the tendency of over and under invoicing by businesses, speakers at a meeting said.
The issue was discussed at the licence giving ceremony of the country's maiden CX. The Chittagong Stock Exchange (CSE) received the licence from the securities regulator.
A CX is a legal entity that determines and enforces rules and procedures for trading in standardised commodity contracts and related investment products.
As chief guest, Ahsanul Islam Titu, state minister of the commerce ministry, attended the programme held at the office of the Bangladesh Securities and Exchange Commission (BSEC).
"The CX will widen opportunities for investors. Asset management companies and merchant banks will get the scope of diversifying their portfolios, with new products to be traded on the CX," the state minister said.
BSEC Chairman Prof. Shibli Rubayat Ul Islam said the CX was a missing component in the capital market.
Apart from ensuring the fair pricing of commodities, the exchange will lessen the problem of over- and under-invoicing in exports and imports, he said.
The securities regulator in 2021 gave primary consent to the CSE for establishing a commodity exchange.
With the support of an Indian consultant appointed in 2022, the port city bourse framed rules.
Initial products of the CX will be gold, cotton and crude oil.
Now the CSE will work to ensure infrastructure required for the CX.
The port city bourse is likely to appoint IT consultants soon along with framing draft of regulations for the CX.