Gold a safe bet in current economic uncertainty

In a world of political
and economic
uncertainty, gold
seems to be the one
commodity holding its own.
This is good news for
Africa and South Africa,
still heavily reliant on gold
mining.
With most analysts
predicting that the buying
of gold is set to increase in
2017, expectations are that
demand for the commodity
will rise in the next few
months.
According to Mark
Bristow, CEO of Randgold,
there is major opportunity
for gold mining in Africa,
but he says it has to be a
long-term approach rather
than a reaction to shortterm
market demands.
“Global sub-Saharan
Africa – excluding South
Africa – boasts as many
reserves as Australia, more
than Canada and the US and
other more infrastructurally
endowed regions.”
Harmony Gold COO
Philip Tobias said that
Brexit and the election of
Donald Trump were to the
advantage of South African
gold players. “We have
done a very lucrative short
term hedging programme,
hedging the currency and
the gold price and we are
benefiting from that.”
He said the gold market in
South Africa did, however,
need to improve efficiencies
if it wanted to remain
competitive in the
world arena.
Economist
Dambisa
Moyo believes buying gold is
possibly the best investment
in the current turbulent
economic times.
There’s also an
expectation that demand for
gold in China will increase
in the next year.
“China saw demand in
2016 that equates to around
80% of South Africa’s total
gold production,” said John
Mulligan, a member of the
World Gold Council. “We
have not seen anywhere
near the real demand
coming out of China when
it comes to gold. There
are still up to 300 million
people in China who don’t
have access to gold today.
We will see a continued
and very major increase in
demand from China. It will
be the biggest market in the
long term.”