Tuesday, 21st February 2006 (3482 views)

Hong Kong's desire to become a regional gold hub may soon be fulfilled.

The Chinese territory has been lobbying the government to set up a bonded warehouse at Hong Kong airport for three years, which could transform it into a regional trading hub.

But speculation is growing that the government will make a decision this week, with one Hong Kong official telling Reuters "the time is probably mature".

Such a move would allow Hong Kong to serve the fast-growing Chinese market and other countries in the region.

China's gold market is perceived to have enormous potential over the coming decades, according to Reuters.

The country is estimated to have consumed 400 tonnes of gold in 2004, equating to 12 per cent of the global total.

But Hong Kong faces stiff competition from Shenzhen in China, a jewellery manufacturing hotspot that is also lobbying Beijing for a bonded warehouse.

China is also a growing producer of gold, churning out 224 tonnes of the yellow metal last year, according to China Gold Association.

 

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