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Published on Gold Anti-Trust Action Committee (http://www.gata.org)

Difficulty locating Internet petition to clarify U.S. gold policy

By cpowell
Created 2001-07-28 07:00

By Andrew Davidson
South Africa Business Report
July 25, 2001
http://www.businessreport.co.za [1]

Johannesburg -- Kelvin Williams, the marketing director
of AngloGold, the world's biggest gold producer,
yesterday slammed the vast majority of global gold
mining companies for not taking responsibility for the
promotion of their product and doing "nothing
whatsoever" to grow or maintain the health of the gold
market.

Instead they were riding on the backs of those who
coughed up millions of dollars each year to support and
promote the industry.

Williams disclosed that only 30 percent of gold
producers supported the World Gold Council (WGC), a
non-profit body set up 14 years ago to "simulate and
maximise" the demand and holding of gold by consumers,
investors, industry, and the official sector (central
banks).

AngloGold, which has an output of about 7 million
ounces of gold a year, pays a membership fee of $13
million a year, or $2 for each ounce produced. South
Africa's second largest gold miner, Gold Fields, with
an annual output of about 4 million ounces, is also a
fully paid up member of the WGC, as are Harmony, Avgold
and JCI.

Among local gold companies that do not contribute is
Durban Roodepoort Deep.

There has been much hype about the WGC spending $55
million this year to "reawaken" interest in gold
through an intensive marketing, advertising, and public
relations campaign.

But Williams said this compared with $200 million spent
each year by diamond group De Beers during the last
decade, and aimed at a smaller market.

Williams said that during the past 10 years the WGC's
annual budget had fluctuated from $70 million at its
peak to $30 million.

"We think there are many gold mining companies which
recognise the importance of maintaining a healthy
physical market for gold and benefit from that market
being there always to take their product.

"But unfortunately there is a large number of gold
producers who take no responsibility for the marketing
of their product and who have over a number of years
done nothing whatsoever to grow that market or maintain
the health of that market," said Williams.

Many of them, he said, "hide behind spurious reasons".

One large producer, he said, wanted a guarantee that
central banks would not sell more gold. Others refused
to join the WGC in protest at some of the members'
hedging positions.

Williams, who masterminds AngloGold's hedging
programmes, which have saved his group millions of
rands, is convinced that hedging does not have a
significant influence on the gold price.

AngloGold, through Williams, will spend about $3
million in marketing its product this year in addition
to the WGC contribution.

Williams admitted that today there were few new markets
for gold, with even the once precious metal hoarding
Japanese keeping their yen in their pockets. In other
less developed countries more people are buying
cellular phones and trendy sports shoes in preference
to gold jewellery.

The jewellery industry, however, still remains the
biggest customer of gold, taking about 81 percent of
the 4,000 tons of annual demand. About 2 550 tons of
gold will be produced this year, so the residue has to
come from sales and scrap.

Williams said the main thrust for marketers was to
sustain the healthy demand for gold in the established
markets of developed countries. But they were
constantly on the lookout for other potential,
deregulated markets.

Thailand has started to offer that potential, but the
big carrot for gold producers is likely to be China
with its burgeoning economy and strong indications that
it will deregulate its gold market next year.


Source URL:
http://www.gata.org/node/1189