<div id="readability-page-1">Hong Kong and Singapore have crossed swords over their ambitions to be the world’s gold trading hub, but experts say the city holds an advantage over its Southeast Asian rival, citing its access to mainland China’s robust market. As Hong Kong pushes ahead with measures to create an ecosystem for gold trading – highlighted as recently in the government’s budget late last month – Singapore has reportedly been courting global heavyweights. In response to the South China Morning Post’s queries a rumoured alliance with the world’s major market makers such as JP Morgan and UBS, the Monetary Authority of Singapore (MAS) did not deny the reports and highlighted ongoing engagement with the sector. “Since last year, MAS has been actively working with key gold market participants to look at ways to support the growth of the gold market in Singapore,” a spokesperson said. Singapore’s central bank added it would share more details on key initiatives in due course. Commodities trading, especially in gold and silver, is back in vogue, with precious metal prices shooting through the roof amid growing geopolitical uncertainty. Financial Secretary Paul Chan Mo-po reiterated the city’s goal to be a global gold trading hub during his budget speech on February 25, which outlined tax concessions to spur bullion trading. Haywood Cheung Tak-hay, chairman of Hong Kong Gold Exchange (HKGX), emphasised the mainland connection was irreplaceable, as China was the world’s largest gold producer and consumer. He said the city even provided a vertically-integrated supply chain by promoting the use of yuan to settle gold trading. Following a January agreement with the Shanghai Gold Exchange and Shenzhen regulators, Hong Kong formalised governance for the government-owned Hong Kong Precious Metals Central Clearing Company, set to begin trial operations this year. The deal also targets storage capacity exceeding 2,000 tonnes within three years to position the city as a trusted global vault.  “The [cross-border] gold connect scheme has more mature conditions now and could be expected to be implemented soon,” Cheung added. Legislator Robert Lee Wai-wang, also HKGX vice-president, viewed the competition between the two cities positively. “More competition is not necessarily negative. It can attract more gold business to the Asia-Pacific, promote cross-licensing between companies in both jurisdictions and lead to greater overall growth,” he said. Lee noted Hong Kong’s strong financial foundation – spanning multinationals, small and medium-sized enterprises, and jewellers – along with listings of major mining or gold firms on its active stock and initial public offering markets. He acknowledged Singapore’s strengths in exchange contracts and a more progressive stance on cryptocurrency products, but highlighted Hong Kong’s progress in digital assets, including tokenised gold offerings. “If we want to compete in these innovative areas, the government may need to review whether Singapore’s regulators are more aggressive,” he said. The latest budget proposed exploring tax incentives for qualified institutions in gold trading and settlement, which Lee described as helpful in supporting Hong Kong’s goal of becoming a yuan gold pricing centre. “We cannot rely on inherent advantages without diligent reform. US and European firms want to compete here. RMB business is important, but foreign institutions seek to tap Hong Kong’s gold potential. The key is uniting the entire ecosystem,” he said, calling for more business-friendly policies. Terence Chong Tai-leung, executive director of the Lau Chor Tak Institute of Global Economics and Finance at the Chinese University of Hong Kong, said the city must boost its infrastructure needs. “To scale storage to 2,000 tonnes is substantial. Hong Kong should accelerate building the storage to support the clearing system for secure and reliable trading,” he said. The Airport Authority Hong Kong has initiated a project to expand gold warehousing to a 1,000-tonne scale at the airport. HKGX’s Cheung recognised industry pressure for faster progress but urged a balance. “The industry hopes to move faster, but we need to ensure financial stability and risk control. Clearing cannot be launched casually. All aspects need standardisation to manage risks and boost efficiency,” he said. A spokesman for the Financial Services and the Treasury Bureau told the SCMP that the city’s priority was to launch trial operations of the central gold clearing system this year, with other measures to follow gradually according to their importance. He stressed Hong Kong’s role as a two-way bridge between global and mainland markets. “We remain committed to leveraging our strengths to develop Hong Kong into a leading international gold trading hub,” he said. “This includes building a robust gold trading market, preparing for future mutual market access with the Chinese mainland, and fostering deeper collaboration with international players, including Singapore, as regional cooperation will benefit the broader gold trading ecosystem.”</div>

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<p>Hong Kong and Singapore are competing to become the world's gold trading hub, with Hong Kong seen as having an advantage due to its access to mainland China's market. Hong Kong's government is implementing measures to enhance its gold trading ecosystem, while Singapore is engaging with major market players. Both cities are focusing on expanding their gold trading capabilities amid rising precious metal prices. Experts emphasize the importance of infrastructure and regulatory support for Hong Kong to achieve its goals, while also acknowledging Singapore's strengths in exchange contracts and cryptocurrency.</p>

Hong Kong, Singapore square off in race to become world’s gold trading hub