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Switzerland is the global gold hub
Economy

Switzerland is the global gold hub

Wednesday, 26 August 2015
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Christophe Roulet
Editor-in-chief, HH Journal

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3 min read

Switzerland is renowned as the land of watches and chocolate. That it is also the global centre for gold refining is less well-known.

Despite the fact that most of the gold produced in the world transits via Switzerland. And for good reason: five of the nine biggest refineries – Argor Heraeus, Cendres+ Métaux, Metalor, Pamp and Valcambi – have their head office on Swiss soil. They refine gold to an exceptional purity of 999.9‰. According to experts, 70% of the world’s gold is transformed in Switzerland. Figures published by the country’s federal customs administration state that 3,000 metric tons of this precious metal – roughly the equivalent of world annual production – worth CHF 109 billion entered Switzerland in 2013, and 2,700 metric tons left the country at a value of CHF 118 billion. According to the International Trade Database, this ranks Switzerland at the head of the international gold trade with a market share of some 15%, leaving the country’s watchmakers and jewellers well-positioned for supplies.

In many parts of the world, the extraction of gold implies major violations of human rights and serious pollution.
Carlo Sommaruga

For many years, however, the country’s foreign trade figures for gold were somewhat hazy. “One of the reasons for this statistical mist was to conceal imports of South African gold, despite the international embargo during apartheid, and imports of gold from Soviet Russia,” notes the Socialist national councillor Carlo Sommaruga. A number of Swiss politicians raised the issue before Parliament in Berne. Some exposed the importing of “blood gold” from the Democratic Republic of Congo; others questioned the origin of the gold refined in Switzerland, bearing in mind that “in many parts of the world, the extraction of gold implies major violations of human rights and serious pollution,” particularly in Peru, while others demanded greater transparency. Accordingly, since last year the Swiss administration has listed the country of origin of imported gold. However, given that the customs authority only records the last country of transit, we are still a long way from knowing precisely where this precious metal originates.

A "cause for concern"

Daniel Schweitzer, the director of Dirty Gold War, makes this comment: “The documentary has been a cause for concern among certain industry players. The Swiss refineries refused to be interviewed once they found out where our investigations had taken us and what we knew about the gold trade. This documented research and first-hand accounts seemed to put a lot of people suddenly ill at ease. This film provides irrefutable evidence of a documented reality.” Swiss refinery Metalor responded to Dirty Gold War with a reminder that its activity is subject to Swiss Financial Market Supervisory Authority (FINMA) anti-money laundering regulations, and that it is certified by reputable international bodies including Fairmined, Fairtrade, the London Bullion Market Association and the Responsible Jewellery Council. In a statement issued in June, Metalor declared that “in terms of origin, the gold refined by Metalor is by no means ‘dirty’ gold. Our supply chain requires the identification of the source of the gold and controls that the mine from which the gold mineral is extracted is duly licensed according to local laws. In the absence of official documentation to this effect, we do not accept any gold or other mineral whatsoever.”

That there is a growing awareness of the darker side of gold leaves no doubt. The last word goes to Daniel Schweitzer: “There remains the fundamental question of responsibility. We, as consumers, are also responsible for this trafficking. The industry will only evolve under pressure from consumers. I believe a positive outcome is possible, provided consumers wake up and demand clean gold.”

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