The European Union in July banned imports from Russia of newly minted and refined gold, following similar announcements by the United States, Britain and other Group of 7 countries in June.
Why is gold refined in Switzerland?
“Gold is refined in accordance with the rule of –four nines– or 99.99 per cent, an exceptional grade of purity. To have an ingot refined in Switzerland is a guarantee of quality anywhere you go”, he explains.
Most of the gold produced in the world transits physically through Switzerland, and in particular Ticino. Four of the world’s major refineries of gold are located on Swiss soil.
It is difficult to visualise the enormous quantity of gold that arrives in Switzerland every year. In 2011, over 2,600 metric tons of raw gold were imported into the country, to a total value of SFr96 billion ($103 billion). This was a record, the quantity having more than doubled over the last ten years, not including the gold that transits through Swiss free ports.
To get an idea of Switzerland’s profile in the sector of gold refining and trading, consider another figure: the production of gold from all the mines in the world in 2011 amounted to 2,700 metric tons, according to data from the US Geological Survey.
Switzerland on Wednesday banned imports of Russian gold and gold products, on the heels of similar moves by the European Union and the United States.
The Federal Council, the Swiss government’s seven-member executive board, said in a statement that the gold ban aligned with the European Union’s latest sanctions on Russia in response to its invasion of Ukraine and that Switzerland was “implementing the most urgent measures in terms of time and substance.”
The council added that it had frozen the assets of Russia’s state-owned bank Sberbank, after imposing sanctions last month on dozens more individuals and organizations on the European Union’s sanctions list.
“Switzerland’s list of sanctioned persons and entities in connection with the situation in Ukraine is thus fully in line with that of the EU,” the council said.
Agricultural products and oil supplies remain excluded from sanctions, the statement said, attributing this decision to the global food and energy crisis.
The country is a leader in the gold-refining market, according to a 2018 watch and jewelry sector report by the World Wildlife Fund, with 60-70% of the world’s gold passing through Switzerland to be refined. The precious metal is a common material in Swiss luxury watches.
The European Union in July banned imports from Russia of newly minted and refined gold, following similar announcements by the United States, Britain and other Group of 7 countries in June.
Officials have described the gold sanctions as another strategy to isolate Russia from the international financial system, with Ukraine’s allies already banning most trade with Russia.
Russia is one of the world’s biggest producers of gold and has cranked up the mining of new gold to compensate for the frozen reserves held by Russian companies and oligarchs under sanctions, said Christopher Swift, a national security lawyer who formerly worked at the U.S. Treasury Department’s office of foreign assets control.
Demand for gold has shrunk 8% compared with this time last year, according to the World Gold Council.
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