The China owned bank (IDCBF) is the worlds largest bank and has agreed to buy a precious metals storage vault and its facility in London. This deal will build up Chinas access to Londons gold market. This vault in london holds $90 billion worth of gold (2,000 tons). London is the worlds largest whole sale gold market by trading volume, with $5 trillion worth of gold trade cleared every year. Precious metals have been traded in London for over 300 years. China, however dominates in terms of physical gold trading. Gold imports in China has grown 700% since 2010, and overtook India to become the worlds biggest gold consumer in 2013. China now consumes 40% of the gold that comes from the earth every year.
This article written by Ivana Kottasova, CNN, details the soon to be gold vault deal betweeen China and England. China has a history of being very into gold and precious metals even back to ancient China. This deal will grant China the place with the the most gold imports and exports. This will stimulate Chinas gold trade and the economy. The article is very good at detailing the cause and effect of the trade as well as what this means for Chinas gold industry. It is very important for poeple to realize what this means for the rest of the world as well. Overall this should just be a highlght in Chinas economy but lets hope that China does not take the power to its head.
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