Hong Kong and Shenzhen launches a gold market tie up today, Friday, November, 3, in order to provide a boost to cross-border bullion trading and the internationalization of the Chinese currency.
This was revealed by Hong Kong’s bullion trading bourse on Thursday, November 2. As released on its website, the gold market which has been named as “Shenzhen-Hong Kong Gold Connect” will be launched at a ceremony to be officiated by Hong Kong leader Carrie Lam in the evening, the Chinese Gold and Silver Exchange Society (CGSE).
This would allow mainland Chinese investors to trade gold in Hong Kong for the first time. The new connection follows the Shanghai-Hong Kong gold connect in July 2015 that allowed Hong Kong people to invest in mainland gold markets.
The president of CGSE, Haywood Cheung, said the new linkage would boost gold trading activity between Hong Kong and China and also aid jewellery manufacturers to lower costs.
“We can serve 2,000 to 2,500 gold and jewellery manufacturers in Shenzhen,” Cheung noted. “If the warehouse is in Shenzhen, their logistics, insurance and daily trade will be more convenient and can lower their costs a great deal.”
The next goal to be accomplished by Cheung is to connect with Dubai, Myanmar and Singapore, following the completion of its bonded warehouse in April 2018 in Qianhai in Shenzhen’s special economic zone.
The latest link in the precious metal markets is occurring nearly a year after Hong Kong linked up to mainland stock markets.
The Hong Kong stock connect joined up the Shanghai and Hong Kong stock markets in November 2014 and was extended to include Shenzhen in December 2016, allowing mainland investors to buy Hong Kong stocks, and vice versa.
