The Eurasian electronic commodity exchange of the Silk Road will be created based on the Universal Commodity Exchange Eurasian cooperation
The Supervisory Board of the Financial & Banking Association of the Euro-Asian Cooperation (FBA EAC) supported the proposal of the Presidium of the Business Council of the Eurasian Economic Union (EAEU) on establishment of the Eurasian electronic commodity exchange of the Silk Road. The Association is ready to put forward an initiative for the implementation of this project based on the Universal Commodity Exchange Eurasian cooperation (UCE EC). This was stated by the Member of the Board - Minister in charge of Economy and Financial Policy of the Eurasian Economic Commission (EEC), Timur Zhaksylykov, which first held a session of the Supervisory Board as its Chairman.
According to the Head of the Representation Office of the Association in the Republic of Kazakhstan, the Advisor of the President of the FBA EAC, Aleksey Smolyakov, the feature of the UCE EC was that in this case, the exchange mechanism and the mechanism of clearing mutual payments in a multi-currency mode were combined. Connecting the banks of Russia and Kazakhstan provided for regular service of exchange transactions. According to Aleksey Smolyakov, a wide branch network of the UCE EC is being created with opening settlement accounts for trading participants. This allows them to make payments under contracts in their currency, and cross-border payments and conversion is performed by the exchange itself. In addition to the objectives for expanding the list of currencies and developing the branch network, the UCE EC has the task to establish risk-hedging tools. Aleksey Smolyakov noted that all operators of the Eurasian market were interested in creating a common electronic exchange platform.
While the volumes of transactions at the UCE EC lately have grown substantially. According to the Head of the exchange branch network, Egor Ivankov, for the whole 2016, the amount of transactions on the trading platform between business entities of the Member States of the Eurasian Economic Union amounted to 4 billion rubles, while only in the last five months of the year, the turnover reached 6 billion rubles.
Today, deals are mainly conducted between business entities of Russia and Kazakhstan. Following the session, it was decided to continue the work on state registration of legal entities endowed with functions of a central counterparty, in Armenia, Belarus and Kyrgyzstan to facilitate access for small and medium-sized business entities of the republics to the UCE EC. This will result in an increase in the volume of trading and an expansion of the list of traded commodity nomenclatures.
Press-release at the official Eurasian Economic Commission web-site