THE Zhengzhou Commodity Exchange, one of China’s three major commodity exchanges, said yesterday it has been approved as a recognized market operator (RMO) in Singapore, paving the way to attract more foreign investors to its purified terephthalic acid (PTA) futures contract.

The approval by the Monetary Authority of Singapore will also allow foreign investors to trade certain futures products on the Chinese bourse through Singapore brokerages, the exchange said.

PTA, a petrochemical derivative, is an essential raw material for making polyesters extensively used in producing textiles, packaging and film products.

The Monetary Authority of Singapore issues RMO licenses to firms that wish to operate an organized market or a place to exchange, sell or purchase derivatives contracts or securities.

The Zhengzhou exchange has allowed foreigners to directly trade in its PTA futures contract since late 2018 and more recently launched PTA options trading in December 2019.

Currently, foreign companies and investors have limited access to China’s commodities markets. So far, there are only six Chinese commodities futures contracts open to overseas trading.

(SD-Agencies)