China's official gold reserves currently represent only 2% of its foreign exchange reserves. In those terms, 10,000 tons is not such an extraordinary figure. Since 2000, China has extracted some 6,500 tons. More than half of China's gold production is state-owned; only the China National Gold Group Corporation accounts for 20%.
As such, it is no surprise that China is often considered the best place for Gold IRA investments. That official figure of 1,948 already seems doubtful. Fundamentally, China keeps the gold it mines; domestic mining production is not allowed to be exported. China has allowed direct gold imports into the country, except through Hong Kong, for several years. The “Hong Kong” indicator of Chinese demand is no longer accurate and, in fact, can be very misleading.
The country's largest and oldest gold producer is the China National Gold Group Corporation (CNGGC), which accounts for 20% of total gold production in China and controls more than 30% of domestic reserves. Russia is making a lot of headlines right now, but the main candidate to realistically institute a gold standard is China. It began production in July at its Chang Shan Hao gold mine, in Inner Mongolia province, in northern China, and reached 19,000 ounces of gold on December 18. The World Gold Council (WGC) states that China has 1,948 tons of official gold reserves, but other sources place China's gold ownership (and official reserves) much higher. It is difficult to quantify how much is falling into national hands, but Bron Suchecki, from the Perth Mint, when studying gold flows, argues that China wants private citizens to accumulate 55% of the flow and that the remaining 45% go to commercial banks and the Chinese central bank.
The United States, for example, has 8,133 tons of gold in its reserves, while China officially has only 1,948 tons. Declaring so much gold would be a direct challenge to American supremacy, something that China is not yet ready for. Gold mining in the People's Republic of China has made that country the largest gold producer in the world. Whether imported, mined or recycled, most of the gold that enters China goes through the Shanghai Gold Exchange (SGE), including gold imported from Hong Kong.
In May, it began producing at its Jinfeng gold mine in southern China, with an expected gold production of 180,000 ounces per year.