China Gold Association (CGA) was set up in Beijing Friday, "China
Daily" reported Saturday. It is considered as an important move for
the nation to observegold market rules after having exercised the
central government control on the precious metal for decades, said
the newspaper.
Experts said the establishment of the new organization is a strong
indication of the overall reform of the control and supervision
system for the gold industry. "It is a breakthrough for China's
gold sector to set up such a coordinated and cooperative business
structure," said the newspaper quoted Cheng Fumin, newly elected
chairman of the CGA and also general manager of the China National
Gold Corporation, as saying. Cheng said the new scheme would meet
the requirements of the World Trade
Organization (WTO) and use market principles to manageand
supervise the operation of gold businesses.
China is to be formally inducted as a member of WTO on December 11.
The establishment follows the announcement of the
much-heraldednational gold exchange which is set for a soft opening
Wednesday in China's leading financial city of Shanghai ahead of an
officiallaunch in January.
The new exchange in Shanghai will replace the People's Bank of
China (PBOC)'s role in quoting gold in line with fluctuations on
the world market--a major job used to be done by PBOC to stabilize
the market.
According to the provisions of CGA, it will provide a platform and
create channels for China's gold producers, processing businesses,
wholesalers and retailers to exchange information and link together
to promote the development of gold industry in China.
CGA will act as a bridge between the government and gold companies
in protecting business interests and providing information,
consultancy, coordination and intermediary services for them. Yu
Yujuan, deputy head of the Currency, Gold and Silver Administration
with PBOC, said CGA will play an active role in helping gold
enterprises complete market reform and sharpen their competitive
edge during the transition period after China's entry to WTO. It
will also be fully involved in market supervision to promotea
healthy and sustainable development of the market. PBOC has
monopolized the purchase and allocation of gold in China for
decades.
Shen Xiangrong, chairman of the Shanghai Gold Exchange and
alsovice-chairman of CGA, said the new organization is the fruit of
anopen market, and the administration and supervision by an
specialized business association may be regarded as an guarantee
for a fair and competitive market. The entry of foreign firms to
the market will bring advanced operation skills, processing
technologies and sales ideas, which might help domestic players
progress in a shorter time and stimulate consumption in the
market.
( November 24,2001)