China opens Guangzhou Clearing Corp specializing in commodities

On 26 June, China set up its first commodities clearing house for business in Guangzhou, Guangdong. It will be linking five commodity exchanges. The commodities clearing house is projected to record total annual transactions of CNY 150 billion (USD 22.6 billion). Guangzhou Clearing was registered in March of last year.

In April 2015, Guangzhou Clearing Corp general manager Li Jie had mentioned that the company hopes to attain breakthroughs in commodities flow via innovation, such as in warehouse receipt financing.

Commodity exchanges such as China Emissions Exchange, Guangdong Shunde Enterprises Mergers & Acquisition Services, Guangzhou Data Exchange and Guangzhou Shipping Exchange are connected to Guangzhou Clearing Corp as of May 2016.

“Guangzhou Clearing can prevent behaviors such as fraudulent transactions, price manipulations, and the misappropriation of deposits so as to effectively protect investors' rights and interests, ensure the safety of investors' funds and prevent financial risks,” stated one of its managers.

This is the nation’s second over-the-counter clearing house. Shanghai Clearing House was the first that focuses on interbank services.