Call to open gold market

PUBLISHED : Friday, 22 January, 1999, 12:00am
UPDATED : Friday, 22 January, 1999, 12:00am

Central bank price fixing of gold bullion and jewellery was the chief obstacle preventing the mainland from becoming the industry's growth area in the new millennium, the World Gold Council said yesterday.

The council is stepping up efforts to persuade the People's Bank of China to deregulate the gold industry, bringing to an end what it claims are discriminatory practices.

The council's Far East chief executive, Kerr Cruikshanks, said centralised control detracted from the value of the industry, and stifled the creativity of jewellers, who were given no incentive to make valuable pieces when prices were predetermined.

Mr Cruikshanks said it could take two years before the mainland gold industry was properly deregulated.

'I think there is a definite desire among the PBOC . . . ultimately to bring things into line with the style of the West,' he said.

He hoped mainland authorities would see the benefits India had enjoyed since opening its market.

Executive director of South Africa's Anglogold, Kelvin Williams, said Hong Kong stood to gain if the mainland market was opened.

'You'll see the region's retailers and wholesalers rush in here like shocktroopers,' Mr Williams said.

Mr Williams said the mining industry would remain stagnant as Beijing was not yet willing to tackle it.

It was not a priority for Anglogold to obtain a mining presence there in the foreseeable future, he said.