Gold bars
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SINGAPORE — Singapore is set to become a major gold hub as trade moves east, according to the World Gold Council.
One of the main reasons is that gold consumption in major emerging economies is increasing, and the majority of the market is concentrated in Asia, said Shaokai Fan, head of Asia-Pacific and head of global central banks.
The proximity of these central banks, which are actively counting gold, is another factor, he added.
“The center of gravity of the gold market has shifted eastward, with Singapore deliberately positioned as the potential fulcrum of this new balance,” Fan said at the Asia Pacific Precious Metals Conference held in Singapore.
China is the world’s largest consumer of gold, and its central bank is the largest buyer of gold as the country seeks to increase its gold reserves.
Among central banks, the People’s Bank of China is the biggest buyer of gold in 2023.
In addition, Singapore is close to about 25% of the world’s gold mining supply centers such as China, Australia, Indonesia, the Philippines, Papua New Guinea and Laos.
The need for sources for official gold reserve centers has become a major concern for central banks around the world, especially against the backdrop of a volatile geopolitical climate, Fan said. He added that Singapore could be a “true alternative” to London and New York as a hub for central bank gold vaulting.
“Singapore is ready to lead the gold market in the future,” Fan said, explaining that other factors contributing to Singapore’s important role in the future of the bullion market include the country’s commitment to political stability and removing the sales tax on gold investment.
“The removal of GST for gold investment in Singapore, the establishment of a good shipping refinery here has strengthened Singapore as a gold trading center,” Fan explained.
Since October 2012, the Singapore government has exempted the Goods and Services Tax (GST), also known as sales tax, from investment grade precious metals.