June Chen
Gold and commodity trading offer great potential to grow Hong Kong’s economy, Financial Secretary Paul Chan Mo-po said.
Writing in his weekly blog, Chan said the city will aim to become an international gold hub and build an ecosystem for the trading, storage, delivery and shipments of commodities.
This would help grow the economy and enhance Hong Kong’s status as an international trade and finance hub, he said.
Chan said the turnover of gold in the city has risen steadily over the past decade at a compound annual growth rate of more than 18 percent.
The average daily turnover for gold is currently about US$100 million (HK$780 million) and this has the potential to double, according to industry experts.
Chan said government plans to increase the storage facilities for gold and accelerate the expansion of supporting businesses like trade, insurance and logistics. It will also promote related derivative transactions to gradually build a comprehensive ecosystem.
Besides, a task force of government and private experts will be set up this year to formulate a plan for optimizing market trading mechanisms.
Gold hit a record high of more than US$2,722 per ounce on Friday, and has risen nearly 32 percent this year.
Prices are likely to rise further as growing geopolitical risks raise risk aversion, VT Markets said.
Several jewelry brands in the mainland saw the price of gold jewelry exceed 800 yuan (HK$875) per gram on Saturday, and a young investor booked a profit of 360,000 yuan after buying gold worth more than 1.8 million yuan six months ago, reports said.
In other news, China will support banks and insurers to issue bonds and stocks denominated in yuan in Hong Kong and promote the development of the city’s offshore yuan market to strengthen its status as an offshore yuan centre, the National Financial Regulatory Administration said.