Home>>Business
Last updated at: (Beijing Time) Thursday, November 29, 2001

Shanghai Gold Exchange Starts Mock Operation

China's first gold exchange, the Shanghai Gold Exchange, started mock operations Wednesday. The exchange represents another step towards reforming and signals the liberalization of the gold market.


PRINT IT DISCUSS IT CHINESE SEND TO FRIENDS


Shanghai gold market started operations

China's first gold exchange, the Shanghai Gold Exchange, started mock operations Wednesday.

Local sources say the official launch is expected at the beginning of next year.

Analysts say the establishment of the exchange represents another step towards reforming China's gold trading market.

It signals the liberation of gold market

For years, gold trading has been strictly controlled by the government, with the People's Bank of China, the nation's central bank, monopolizing the purchase and allocation of gold.

The gold exchange, which will mainly target gold producers and wholesalers, is expected to introduce market prices to the country's gold trade, with the central bank gradually withdrawing from its monopoly position.

The exchange currently has 108 members, mainly including gold mining companies, smelteries, jewelry companies, mints, foreign traders, and commercial banks.

Only spot transactions are being conducted during the exchange's initial days of operation. Futures trading is to be introduced when the market becomes more mature.



Gold to be Freely Traded

China's domestic gold market will open up on 28th November once Shanghai Gold Exchange starts operations. Experts predict that with the large industrial demand for gold, China's domestic gold demand will dramatically increase from the current 200 tons to 500 tons per year.

Currently, the gold used in gem and jade jewellery, makes up 96% of all gold purchased on the market. With the establishment of the Shanghai Gold Exchange signaling the liberalization of the gold market, it will be more convenient and cheaper for both enterprises and private individuals to purchase gold.

The Shanghai Gold Exchange has authorized the China Bank, China Industrial & Commercial Bank, China Constructional Bank and China Agricultural Bank as the banks for settling accounts. The commodities traded are "9999" one-kilo gold bullion and "9995" three-kilo gold bullion.
    Advanced

China Sets Up New Gold Organization

CCB Becomes Member of New Gold Exchange

Free Trade for Gold as from 28th November 2001