Wednesday, 28th April 2004 (3168 views)

Profit from China's gold enterprises topped 550 million yuan during the first quarter of 2004 , according to new data.

The China Gold Association calcualtes that the figure represents a year-on-year rise of 48 per cent. The country's gold enterprises recorded an industrial output of nearly 6 billion yuan, 42.8 per cent more than 2002.

The Beijing-based association states on its website that the Shandong, Fujian and Henan Provinces were the three major profit contributors during the first three months of the year, accounting for over 80 per cent of the country's total gold profit. Shandong, Henan Provinces and Inner Mongolia Autonomous Region stood out as the three major gold mining provinces.

The CGA reports that the country's gold firms achieved profit growth through merger and acquisition to benefit from economies of scale, which reduced production costs. The association noted that political instability could force investors to turn back to gold.

"China's gold production cost is higher than the international level," said Zhao Dehua, vice chairman of Shanghai Golden Ornaments Trade Association. "The rising gold prices, pushed up by the global political uncertainty, may be another reason that helped gold firms to enjoy profit growth."

China produced 34.42 tons of gold during the first quarter of this year, 4.7 per cent more than a year ago, China View reports.

 

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