China is Still King of the Gold Hill
China produced over 300 tons gold in 2009, a new world record in output. Already, for the past three years, China has been the world’s largest producer ahead of South Africa, and now the massive nation is also on the verge of becoming the world’s leading gold consumer.
According to Reuters:
“China’s gold output jumped 11.34 percent to a record of 313.98 tonnes in 2009, the China Gold Association said on Thursday, securing the country’s position as the world’s largest producer of the yellow metal.
“China has dramatically opened bullion markets to active trade in the past decade, including allowing gold to be traded freely on the Shanghai Gold Exchange. Gold hoarding was initially outlawed in 1949 when the Communists took power.”
China has come quite a long way since it outlawed gold hoarding, specifically in ways that contrast the US. First, as we’ve previously discussed, the Chinese government officially encourages its citizens to maintain personal savings in gold. Second, the banks in china make converting yuan to gold a relatively pain-free process. As a result, China is now likely to quickly surpass India to also become the world’s largest gold consumer.
Visit Reuters to read more details about China’s record gold output in 2009.