Global gold trading hub status attracts industry leaders to set up operations in Hong Kong
Investment in gold – long considered a traditional safe-haven during uncertain times – is taking on renewed importance amid the current global geopolitical uncertainty, market volatility and shifting confidence. For Hong Kong, this surge in interest comes as it is increasing its effort to become an international gold trading centre – a role that builds on its strengths as an international centre…
InvestHK, Hong Kong's foreign investment promotion agency, is facilitating the growth of a comprehensive precious metals ecosystem, with a focus on gold trading. The city aims to increase its gold storage capacity by over 10 times to 2,000 tonnes by 2030, while also establishing a central clearing and settlement system for gold.
Hong Kong's Chief Executive, John Lee Ka-chiu, has emphasized the importance of developing an international gold trading market, which he plans to achieve through coordinated efforts. The city's government has also reduced the profits tax rate for qualifying physical commodity traders from 16.5% to 8.25% to encourage investment.
Cross-border links with mainland China, including Shanghai and Shenzhen, have been strengthened through agreements for gold settlement and joint development of gold processing and trading. Additionally, Hong Kong aims to foster gold market cooperation with Laos, creating a gold corridor linking producers, refiners, traders, and investors.
The growth of gold trading in Hong Kong is seen as a response to the increasing importance of China and Asia within the global economy. Central banks and investors are diversifying away from US dollar-denominated holdings, with gold being a popular choice. However, diversification requires not only purchasing gold but also having it stored, traded, and settled in a secure location.
Hong Kong provides an alternative to London and New York, with its proximity to the renminbi and mainland gold market. Companies like Chow Tai King, a Shenzhen-headquartered jewellery brand, are utilizing Hong Kong as a starting point for international expansion. The company has set up a gold refinery in Hung Hom, Kowloon, with a capacity of 80 tonnes per year, focusing on gold refining, testing, and quality control.
Chow Tai King also plans to open a showroom in Hong Kong next year and expand into Southeast Asia. InvestHK provides guidance on industry policies and business environment, helping companies navigate the regulatory requirements and accelerate approval processes for gold refining operations.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
