Gold demand is expected to rise in China and other Asian countries along the "Belt and Road" routes in the coming few years, the China Gold Association said on Tuesday.
In a report on the likely impact on the gold market, officials estimated that the 65 countries along the routes, and their combined 4.4 billion population, currently account for more than half of the world gold production, and 80 percent of consumption.
"Asians have a tradition of collecting gold," said Song Yuqin, deputy general manager of the Shanghai Gold Exchange.
"The gold trade is expected to become a significant component of transactions by 'Belt and Road' countries."
Proposed by President Xi Jinping in 2013, the "Belt and Road Initiative" is likely to involve major investment in infrastructure, and growing levels of trade along the Silk Road Economic Belt and the 21st Century Maritime Silk Road.
The economic belt is to be established along the ancient Silk Road trade route, stretching northwest from China's coastal areas through Central Asia to Europe, while the 21st Century Maritime Silk Road will run from China's south to Southeast Asia and even Africa.
So far, more than 60 nations along the routes, and many international organizations have shown strong interest in taking part in the two initiatives.
Over the past decade, gold demand globally has increased nearly 50 percent, while Asia's gold demand has soared around 250 percent during the same period, according to the World Gold Council.
Last year, China and India's demand for gold jewelry and bars accounted for 54 percent of the world total.
"In the next few years, China, India, Thailand and other emerging economies in Asia will have great demand for gold, providing significant opportunities for the growth of gold industries around the world, and for gold trading," Song said.
China's gold production and consumption jumped in the first quarter despite the lackluster global market. China produced 110.7 tons of gold in the period, a 14.72 percent rise over last year, according to the latest data by the CGA.
From January to March, China's total domestic gold consumption amounted to 326.7 tons, a 1.14 percent rise year-on-year, which was mainly attributed to the country's increasing consumer demand for jewelry and bars, the report said.
Last year, China's gold production stood at 451.8 tons. The market first surpassed South Africa to become the world's largest gold producer in 2007 and has remained the biggest producer for eight straight years, according to the report.
China's growing interest in gold, however, was the opposite of what has been happening on the world market, where the price of the medal has been falling, said Philip Klapwijk, head consultant of Metals Focus, an independent precious metals consultancy.
"The strengthening US dollar and booming global stock markets have dampened market sentiment," he said.
