The Zhitong Finance App learned that on October 13, at the opening ceremony of Dianjin International's Hong Kong headquarters, the Hong Kong Secretary for Financial Services and the Treasury, said that the Hong Kong Government is using the development of the international gold trading market as an entry point to promote the collaborative development of trading, clearing, warehousing, refining, insurance and logistics, using physical storage as the underlying foundation, so that gold that meets international standards can be liquidated and delivered in Hong Kong, injecting new high-value-added growth impetus into finance, trade and shipping logistics.
He mentioned that Dijin has been deeply involved in the precious metals industry for many years, and its business covers refining, physical delivery, trading and related services for metals such as gold and silver. The refining companies under the Group are LBMA (London Bullion Market Association) and LPPM (London Platinum and Palladium Market Association) Good Delivery refining companies. Gold and silver products have entered many internationally recognized trading and delivery systems. It is also a liquidity provider for HKEx's US dollar gold futures, and actively participates in related market making and physical delivery services. The opening of the new headquarters is a substantial investment rooted in Hong Kong and reflects the industry's confidence in Hong Kong as an international precious metals hub.
The country's “Outline of the 15th Five-Year Plan” clearly proposed for the first time to support Hong Kong in building a commodity trading ecosystem. The “Hong Kong First Five-Year Plan” also proposed using gold as an entry point to build a commodity trading ecosystem.
Xu Zhengyu pointed out that refining is an indispensable part of this ecosystem. Gold that circulates in international markets and is used for trading and delivery must be handled by a qualified refiner with a brand, code, and purity record. Hong Kong currently has LBMA accredited refineries to serve customers in the Asia-Pacific region; in addition, many companies that have qualified for international standards have expressed interest in settling in Hong Kong. The authorities are pushing for more enterprises qualified to international standards to set up or expand refining facilities in Hong Kong.
Meanwhile, Hong Kong's relevant infrastructure is entering the implementation stage. The Hong Kong Gold Central Clearing and Settlement System was put into trial operation in July of this year, with the goal of being officially launched in the first quarter of next year. The system is overseen by the Hong Kong Gold Clearing Company, which is wholly owned by the Hong Kong Government. BOCHK has been appointed as the clearing agency; the Board of Directors of Hong Kong Gold Clearing Corporation has also invited opinions from the Government, the Shanghai Gold Exchange, regulators and 11 banks. In the future, the system will connect to instant payment and settlement systems to enable bank transactions and reduce settlement risks.
Hui Ching-yu also pointed out that Hong Kong is studying the provision of tax incentives for eligible institutions that trade and settle gold in Hong Kong, and is optimizing the preferential tax system for funds and single family offices. It is proposed to expand the scope of eligible investments to cover precious metals. It is also cooperating with the Financial Development Council to launch a gold trading course on a pilot basis during the year to strengthen the training of local talents.
In addition, Hong Kong has launched the first phase of physical connectivity with the Shanghai Gold Exchange, and the Hong Kong Gold Clearing Company has applied for international membership. Market participants can participate in the two markets through two-way transfers to facilitate the flow of physical gold between the two local systems. In terms of warehousing, the authorities are promoting the expansion of the capacity of the Hong Kong Airport Authority and financial institutions to build a regional gold reserve hub with the goal of surpassing 2,000 tons within three years.
In the future, Hong Kong will introduce more new policies to maintain the popularity of the gold ecosystem. The next step is to set up a “gold line” to help domestic and foreign gold merchants participate in the ecosystem in one stop, and set up a preparatory team to push the industry to independently establish and operate gold industry associations.