The Dubai Development and Investment Authority (DDIA) has signed a Memorandum of Understanding (MoU) with the New York Mercantile Exchange (NYMEX), to jointly explore, in the coming months, the development of the Dubai Mercantile Exchange (DME), the region's first commodity futures exchange.
The joint study will focus on the creation of new and differentiated products, primarily revolving around commodities such as crude oil, natural gas, electricity futures and metals such as aluminium and gold.
According to Chairman of the Board of DDIA Mohammed Al-Gergawi, DME will strengthen Dubai's ties with the international finance and commodities trading community, attract foreign direct investment (FDI).
“Every major trading hub worldwide has developed a commodity exchange except for the Middle East, which is home to 65 percent of the world's crude oil and 40 percent of the world's natural gas reserves,” stated Gergawi. He emphasized the importance of making Dubai a trading hub, as per the vision of Crown Prince of Dubai, Sheikh Mohammed Bin Rashid Al-Maktoum, and stressed the participation of the private sector in furthering the economic development of Dubai.
The exchange will comprise of traditional exchange components including a trading floor and clearing house. The project envisions the establishment of a training institution for empowering the region's youth to operate successfully in the modern derivatives environment. In addition, NYMEX will offer top United Arab Emirates (UAE) candidates training through internships on its trading floors in New York.
The New York Mercantile Exchange is the world's largest physical commodity futures exchange and the pre-eminent trading forum for energy and precious metals. Trading is conducted through two divisions, the NYMEX Division, home to the energy, platinum, and palladium markets; and the COMEX Division, on which all other metals trade. — (menareport.com)
© 2004 Mena Report (www.menareport.com)
