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From: Jimjones1972 (Rep: 3)Date: 09/25/2018 15:23
Forum: Mining and Commodities Eh! - Msg #6216 - List AXM.V msgs Thread #674037118 (Rec: 0)
WGC’s China Chapter will boost gold sector: analysts

http://www.globaltimes.cn/content/1120902.shtml

WGC’s China Chapter will boost gold sector: analysts

By Zhang Hongpei Source:Global Times Published: 2018/9/25 22:18:39


The new China Chapter being established by the World Gold Council (WGC) will bolster internationalization of the domestic gold market and offer more opportunities for Chinese gold enterprises to go global, said industry analysts.

The WGC, a leading world organization for the industry, announced on Monday at its annual meeting in the US state of Colorado that it has established a China Chapter, according to a statement the organization sent to the Global Times Tuesday.

The new chapter, which will be chaired by Song Xin, chairman of the China Gold Group, will enable Chinese member companies of the London-based WGC to engage more effectively with the rest of the board, said the statement.

It was announced on the same day that Shanghai-listed Shandong Gold Group will join the WGC board as a member, becoming the second Chinese enterprise on the board after China Gold Group.

"The Chinese gold industry has developed phenomenally over the past couple of decades, and China is now the largest producer and consumer of gold globally. As such, we are delighted that the WGC's membership is expanding, to better reflect the shape of the global gold mining industry," said David Harquail, chair of the WGC, according to the statement.

China's gold output reached 426 tons in 2017 with consumption hitting 1,089 tons, making it the world's No.1 country in terms of production, consumption and processing, Song told the Xinhua News Agency on Tuesday.

Jiang Shu, partner and investment director of Shanghai-based Oak Investment, told the Global Times on Tuesday that with China's upstream gold mining companies becoming strong, the establishment of the new chapter is a natural step in line with the development trend.

"More interaction on the same platform enables domestic and international players to have a better evaluation of the global supply and demand of gold... an increasing number of Chinese gold companies are 'going out' while foreign enterprises are quite interested in the domestic market," said Jiang.

"The new chapter is set to have a far-reaching influence on China's gold market, offering opportunities for domestic companies' upgrading as well as overseas mergers and acquisitions," Zhou Yinghao, an independent analyst of the gold industry, told the Global Times Tuesday.

The platform will enable the Chinese gold supply chain to play a bigger role and have a bigger say in the global gold market, Zhou noted.

Jiang said that more domestic gold producers would expand overseas via the new channel. That will hasten the opening-up of the Chinese gold market, which is currently led by commercial banks in terms of imports.

In 2001, the People's Bank of China, the central bank, ended controlled procurement and distribution of gold, and the precious metal began trading on the Shanghai Gold Exchange the next year. Since then, the market has achieved "remarkable development," especially because it has been a relatively short period, said Zhou.

Yet, related laws and rules, especially basic laws, need to be improved, Jiang pointed out.

"Gold products have become more diversified and their prices are more linked with the international market to meet increasing domestic demand," Zhu said.

In the second quarter of this year, China's total gold demand reached a three-year high of 332.9 tons, data from the WGC showed.

With the establishment of the China Chapter, the current low market price for the metal is likely to increase at the end of this year or the beginning of next year, which will bring many opportunities for the WGC's new China chapter, according to Zhou.

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