Switzerland As A Global Gold Trader

International hub of the gold trade

Switzerland is a significant member of the global gold trade. The country imports on average between 2500 and 3000 metric tonnes of mined and recycled gold annually from more than 60 countries. It hosts four of the world’s largest gold refineries and supplies the equivalent of 70% of global annual production.

Switzerland indirectly receives precious metals from Africa via third countries. A considerable part of the production of gold from Congo is delivered to neighbouring countries Rwanda and Uganda. Due to the fact that these transit countries have no gold deposits of their own, they mainly supply the world market via Dubai.

Despite the fact that almost no gold is mined in Switzerland, the country is one of the most important places for the import and export of gold. About 40% of the world’s refining capacity is located in Switzerland. In Ticino and western Switzerland, there are goldsmiths’ workshops that melt gold pieces, process raw gold, and certify the precious metal. In addition, the gold is also bought and refined across the borders of Switzerland.

Challenges of the current market 

Unfortunately, the current data does not fully show the detection of the actual countries of origin and Swiss customs only keep track of the last transit country. The importance of the UK stems from the location of the Bullion Market Association (LBMA) in London, which is the most important centre for the trade in gold and silver worldwide.

It remains a challenge to determine the origin of gold stored in Switzerland as it gets tangled up in global value chains and some countries have neither the will nor the power to regulate this significant trade more closely by law. In 2018, the Swiss National Bank (SNB) ranked seventh in the world with around 1,040 metric tonnes of gold reserves.
Generally, Switzerland’s gold holdings are stored both domestically and abroad. The largest part of the gold stock is currently stored in Switzerland, while the rest is stored at the Bank of England and the Bank of Canada.

The exact storage location of the gold bars remains a secret for the Swiss National Bank. The Swiss National Bank not only keeps its own gold, but also that of other central banks such as Austria and Italy.