Start of Shanghai Free Trade Zone trading sees World Gold Council and Shanghai Gold Exchange announce future cooperation to develop China's gold market
Published 18 September, 2014
At an event today to mark the start of Shanghai Gold Exchange’s gold trading in the city’s free-trade zone (SFTZ) and the creation of the International Board, the Shanghai Gold Exchange and the World Gold Council have stated they will be actively cooperating to develop the SFTZ as an international hub for gold and to work together to develop the gold market in the region. The event was attended by Zhou Xiaochuan, Governor of the People’s Bank of China, Mr. Xu Luode, the Chairman of Shanghai Gold Exchange and Aram Shishmanian, CEO of the World Gold Council.
The Chinese gold market has grown exponentially in the last 10 years and China is now the largest market for both gold supply and demand. China's rapid economic growth combined with the acceleration of China's financial reforms provide a solid foundation for the internationalisation of the gold market and the country’s deep rooted pro-gold culture will continue to accelerate gold demand. The country’s economic growth (with annual GDP of 7.5%), growing middle class as well as rapid urbanisation and effective government policy support are key factors fuelling gold demand in China, which is likely to grow by 20 per cent within the next three years.
Zhou Xiaochuan, Governor of the People’s Bank of China (PBoC), commented "The launch of the International Board is integral to the construction of the Free Trade Zone and of China's financial market. It will accelerate the internationalisation of China's gold market. PBoC will continuously provide policy support to the Shanghai Gold Exchange to build up a multi-layer financial market."
Aram Shishmanian, CEO of the World Gold Council, said: “The growth of the Shanghai Gold Exchange to become the world’s largest physical gold exchange provides compelling evidence that the future for gold is physical. As the market shifts from west to east, the expansion of strong gold trading hubs in Asia will improve price discovery, liquidity, transparency and efficiency; all of which will transform the landscape of the global gold market. As a major global market, this will enable China to take its rightful place in the world gold market.
“The development of the International Board, opening up the Chinese market to global investors is a significant first step towards the internationalisation of China’s gold market which already accounts for 30 per cent of global demand. The World Gold Council’s role is to use its global expertise to help support and grow that market on the international stage.”
This collaboration follows on from a partnership signed between the China Gold Association and the World Gold Council in Beijing last week at the China Gold Congress and Expo, which they jointly sponsored. This partnership seeks to promote further international enterprise in China and to enhance the global understanding of China’s role within the global supply chain.
For further information please contact:
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World Gold Council
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Note to editors:
The Shanghai Gold Exchange was established in 2002. The World Gold Council was actively involved during the consultation and development process and was one of the key drivers and catalysts for this transformation.
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World Gold Council
The World Gold Council is the market development organisation for the gold industry. Working within the investment, jewellery and technology sectors, as well as engaging in government affairs, our purpose is to provide industry leadership, whilst stimulating and sustaining demand for gold.
We develop gold-backed solutions, services and markets, based on true market insight. As a result, we create structural shifts in demand for gold across key market sectors.
We provide insights into the international gold markets, helping people to better understand the wealth preservation qualities of gold and its role in meeting the social and environmental needs of society.
Based in the UK, with operations in India, the Far East, Europe and the US, the World Gold Council is an association whose members include the world’s leading and most forward thinking gold mining companies.