Singapore: The Emerging Gold Hub of the East

Singapore: The Emerging Gold Hub of the East

Singapore is on track to become a prominent gold hub as trading patterns shift towards the East, largely due to the increasing gold consumption in major emerging economies. Shaokai Fan, the head of Asia-Pacific and global head of central banks at the World Gold Council, pointed out that a majority of these growing markets are concentrated in Asia. This surge in demand is attracting central banks in the region to actively acquire gold, leading to the establishment of Singapore as a potential hub for gold trading.

One significant advantage that Singapore holds in the gold market is its proximity to central banks that are increasing their gold reserves. China, the largest consumer of gold in the world, has been actively buying bullion to boost its reserves. The People’s Bank of China emerged as the largest buyer of gold in 2023. In addition, Japan and South Korea have also shown strong demand for gold, contributing to the rising trend in the region.

Moreover, Singapore is strategically located near approximately 25% of the global gold mining supply centers, including China, Australia, Indonesia, the Philippines, Papua New Guinea, and Laos. This geographic advantage positions Singapore as a key player in the gold market, especially amidst concerns over the need for official gold reserve centers in light of geopolitical uncertainties.

Fan emphasized that Singapore has the potential to rival traditional gold trading centers like London and New York, especially in terms of central bank gold vaulting services. The country’s stability, along with the removal of sales tax on investment gold, has further strengthened its position as a leading hub for gold trading. Since October 2012, Singapore’s government has exempted the Goods and Services Tax (GST) from investment grade precious metals, making it a more attractive destination for investors and central banks alike.

Singapore is poised to lead the gold market in the future, driven by the increasing gold consumption in Asia-Pacific, its proximity to key central banks and gold supply centers, and the supportive regulatory environment for gold trading. With its strategic advantages and growing role in the global gold market, Singapore is well-positioned to emerge as the premier gold hub of the East.


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