The proposed new gold import regulations for Chinese individuals have interesting implications for the gold price. In particular, the recommendation that individuals can bring in up 7 ozs of gold without customs accountability or reporting seems interesting.
The population of the world's most successful economy is around 1.35 billion people, and many of them will be children. However, gold is culturally and historically attractive to all Chinese people.
If we take just 1% of the total population and suggest that they might be well-disposed to to the metal and to the importing of 7 ozs of gold (and the Reuters article does not say how many times a year they could carry in gold) that suggests maybe 13.5 million people might be gold importers.
If they took home their full allowance of 7 ozs that would equal 94.5 million ozs of gold.
World annual mine production of new gold in 2012 was about 2700 tonnes ie 95.24 million ozs.
So, the new allowances would create a potential on conservative assumptions of imports about equal to new annual mine production.
No wonder the local gold dealer sounded unhappy.
Please check my arithmetic.
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