The CE Exchange (CEX) launched this morning is expected to bring an important boost to world liquidity and trade. The exchange is an international venture that will trade “anything and everything” using latest international nanosecond technology, according to CEO and founder, Avrilatam Fish.
The commodity section is initially the most active, as screens track soaring prices for gold, oil and other key commodities produced in Africa. The exchange also seeks to draw “a significant portion” of diamond trading back into Africa from shadowy international markets in the Netherlands, Israel and London but some traders are initially reluctant, fearing the new delivery mechanisms could amount to entrapment by southern African law agencies.
Intra-regional currency trade is also a first for the new market, made possible by improved banking systems in several regions. There are two boards, “official” which operates similarly to most international trading systems and “parallel market” where some settlement and delivery problems are already experienced.
However, CEX also promises to open up trading in a wide range of other much needed commodities. Market demand for governance and peace seemed urgent in some countries, and states such as Namibia and Botswana which have settled all disputes peacefully since independence and have democratic institutions and media freedom may be tempted to spread the good news. Outside traders such as Victor Yanukovych (his 2004 election win was annulled after allegations of rigging and lost subsequent free and fair elections) threw into the trading ring his view that it was the right choice to concede even if he did not accept the initial annulment: “I didn’t want dead bodies from Kiev to flow down the Dnipro. I didn’t want to assume power through bloodshed.” Peace futures could attract high prices, arbitraged against the cost of war, although arms traders may stage a dawn raid in coming days.
The transparent trading system also threatens shadowy vulture capital deals by putting millions of hectares of African farmland and rivers onto the land exchange screens. Trading in the cash “grab” market was active with aggressive foreign buyers, but deals priced without the “good tax revenue and sustained benefits for locals” rider seemed to correlate negatively with peace futures trading.
On the press tour after the opening ceremony trading was starting on the husband exchange section. “Faithful and good in house” was drawing more long-term interest than “rich playa”.
Key to the success of the new exchange will be the formidable clearing and settlement systems required of a global commercial activity hub. With a strong emphasis on agricultural and a wide range of other commodities, systems to ensure quality, standardization and prompt delivery of all sold goods are crucial and several hectares behind CEX are devoted to extensive inspection, warehousing, and logistics. Farmers who had forward sold lots of 300 kg of beef for October delivery were offered feeding systems for their 60 kg calves. Cash,gold and diamonds deliveries were being inspected by armed men in dark glasses and radioactive suits were required for inspectors on deals in drums of uranium ore. Peer review and governance mechanisms were being stepped up in order to solidify delivery on the peace market.