Dubai: Country and Foreign Investment
Dubai Gold and Commodities Exchange (DGCX)
The DGCX commenced trading on November 22, 2005, and is the first international commodities derivatives market in the Middle East region. DGCX offers a range of commodities, commencing with gold futures, with electronic trading accessible from anywhere in the world.
Transactions on the DGCX take place on a state-of the-art electronic trading platform.
The exchange is established within the Dubai Metals and Commodities Centre (DMCC), which is a strategic initiative of the Dubai government created to establish a commodity market place in Dubai. The DMCC is also a free zone authority offering 100% business ownership, a guaranteed 50 year tax holiday and freehold property options.
The DGCX is regulated by Emirates Securities and Commodities Authority.
Alongside the DGCX, the newly created Dubai Mercantile Exchange (DME) is likely to focus on energy trading starting with crude futures, and will not compete against the DGCX.
In February 2006, the DME unveiled its plans to launch a new trading hub concept on an electronic trading floor, in an effort to capitalize on local liquidity, draw regional market participants and attract financial institutions from the Middle East and internationally.
Once the trading in futures is stabilised, the DGCX will allow options trading on different commodities.
In February 2013, the DME announced the passing of a significant trading milestone, with a total of 4 million contracts (equivalent to 4 billion barrels) traded on the Exchange since its opening. This milestone came just 10 months after the DME passed the 3 billion mark and continues the trend of strong trading growth on the Exchange.
The 4 millionth trade on the Exchange took place between Japanese trading house Mitsubishi Corp, and the Anglo–Swiss multinational commodities trader, Glencore, highlighting DME Oman's position as a credible benchmark for oil trading for the Asian markets. DME Oman remains the largest physically delivered crude oil futures contract in the world, with the Exchange trading the equivalent of more than 1 billion barrels of oil for the first time in one year during 2012.