 |
China to Open Up Silver, Gold Market
China is to open up this year its silver and gold market which were previously under strict state control, according to the latest issue of Beijing Review.
A recent circular issued by the People's Bank of China says that the state will no longer impose restrictions on most of the processing, purchasing or sale of silver.
The producer and retailers will be able to conduct business directly and the production and sale of silver will be managed the same as other ordinary commodities.
The opening up of the silver market signals the end of 50 years of strict control and a speeding up of the country's march toward market economy.
Related departments are also working on regulations to encourage fair competition and trading in the silver market.
After the opening up of the silver market, many experts suggested that the gold market also be opened up to enable ordinary Chinese people to possess more gold.
However, the government prefers a more cautious approach toward the gold market. One of the trial runs for opening the market was the sale of 1.5 tons of gold bars, which began December 10, 1999.
The gold bars, called "millennium gold bars" were sold at designated stores in 11 cities, including Beijing, Shanghai, Nanjing and Chengdu.
The "millennium gold bars," engraved with dragons, are believed to be unusually valuable collectors' items. The bars, weighing anywhere from 50 to 500 grams, were sold at a rate of 104 yuan per gram in Beijing, 110 yuan per gram in Shanghai and 112 yuan per gram in Nanjing.
The price is approaching the international market price, but is still a little higher.
In Beijing, the "millennium gold bars" were sold at Caishikou Department Store, which has been renowned as the capital's premier gold store. Although the store sold the bars only four hours a day, sales surpassed two million yuan every day.
Within five days, the store had sold more than 1,000 gold bars. Since the demand was so large, the store ran out of gold to sell.
So far, about 2,000 people are still waiting to buy gold bars.
Experts said that the major reason for people to buy gold is that the people are having a difficult time spending their extra money at a time when market demand falls short of supply and the interest rate has been lowered several times to stimulate spending. A survey shows that people in Shanghai possess an average of 0. 28 grams of gold, compared with the more than eight grams owned by Hong Kong residents.
Many observers noted that although the sale of the "millennium gold bars" was just a trial opening up of the market, it shows that the day when the gold market will be completely opened to gold investors is coming soon.
In This Section
|