Author: Paul Ploumis
26 Jan 2015 Last updated at 07:35:02 GMT
BEIJING (Scrap Monster): The Stock Exchange of Thailand (SET) is reportedly working towards establishment of the country’s first ever physical gold exchange. According to Sathit Limpongpan, Chairman, SET, major gold dealers have agreed to become part of the exchange. However, the shareholding pattern between the bourse and the dealers are still under discussion.
Earlier, SET’s proposal to set up the spot gold exchange had suffered setback with aq small group of traders refusing to join the exchange on account of ambiguity over management and shareholding between the SET and the shareholders. Meanwhile, Thailand’s Securities and Exchange Commission has extended full support in creation of the exchange. Moreover, initial fund of 1 billion baht has also been allocated towards setting up of the exchange.
Meanwhile, the proposed gold exchange is pending to approval from Finance Ministry and the Bank of Thailand. Sources indicate that the launch of the exchange would require amendment of existing laws. Also, Bank of Thailand had earlier indicated that it needs more time before trading in dollar can be finally approved. Hence the final launch of the gold exchange is expected to take some more time.
The physical delivery of gold will be the responsibility of gold dealers. In this way, the success of the exchange depends a lot on professional gold traders. SET will provide the necessary trading platform. It will also coordinate the clearing, settlement and back office operations.
By becoming part of the gold exchange, the gold traders in the country expect their trading volumes on gold to improve significantly. Also, setting up of the exchange would aid SET to achieve its goal of becoming the leading exchange in the Southeast Asia.