Indonesia's first futures exchange scheduled to open in March
Indonesia's first futures exchange scheduled to open in March
JAKARTA (JP): Indonesia Futures Exchange (IFEX), the country's
first commodity futures exchange, will begin trading in March
next year, the exchange's president Hasan Zein Mahmud said on
Thursday.
"We will have seven months from now to develop the computer
system, trading regulations and other supporting infrastructure
for IFEX to start operating," he said at the official launch of
the exchange.
The country's long awaited first futures exchange IFEX was
finally established by its 29 founding members on Aug. 19 after
more than an eight-month delay.
Hasan, the former president of the Jakarta Stock Exchange
(JSX) said that he was glad that Indonesia would soon open its
first commodity futures exchange.
Indonesia as a natural resource-rich country, he said, badly
needed a commodity futures exchange to help its commodity
producers, manufacturers, exporters and end-users in managing
their risks against unpredictable price fluctuations.
Through the futures bourse, commodity producers could protect
themselves from a drop in prices by signing a contract to sell
their crop at a certain date in the future at a prearranged
price, he said. "If the price drops before that date, producers
will not suffer any losses," he added.
Hasan said that the management office and the trading floor of
IFEX would temporarily be located at Menara Kadin Indonesia
building, floor 25.
Minister of Industry and Trade Rahardi Ramelan, who attended
Thursday's launch, said that the futures exchange management
should study other commodities that could be included in the
exchange trading.
"Corn and plywood for example could be considered to be
included on the futures exchange trading as well," he said.
The futures exchange is only permitted, based on the 1999
presidential decree No. 12, to trade palm oil and coffee.
Rahardi said that it was possible for the exchange to trade
more than these two commodities at the initial stage of the
exchange operations.
IFEX has an authorized capital of Rp 40 billion (US$5.2
million) and paid-up capital of Rp 11.6 billion.
The establishment of IFEX is based on the 1997 Commodity
Futures Exchange Law, while its operational guidelines are
expressed in the 1999 government regulation No. 9 on commodity
futures exchange.
IFEX's operations is supervised by the Indonesian Commodities
Exchange Agency (Bapebti), which is under the auspices of the
Ministry of Industry and Trade.
Commodities clearing houses PT Kliring and PT Jaminan Bursa
Komoditi, and commodities traders and brokers will also help in
IFEX operations. (udi)