Thanks to its constant economic value and highly liquid nature as an asset, gold investment has lured many people in Southeast Asia amid the global economic slowdown.

This business trend has been observed in several Southeast Asian countries lately.

Indonesia's state-owned miner, PT Aneka Tambang (Antam), for example, is planning to open three new gold boutiques in Medan, North Sumatra; Batam, Riau Islands and Yogyakarta, Central Java.

Antam operational director Tedy Badrujaman said the company had chosen to open its new boutiques in the regions based on considerations of purchasing power and local culture.

He said the company had kept track of the sales figures of gold in every region where its boutiques operated. According to him, the company sees some regions, including the three regions where the new boutiques will be opened, as potential areas for gold investments due to their populace's high level of average income.

The company has taken local culture into consideration when opening a new boutique.

"Some regions use gold in their traditional ceremonies. While residents of several Indonesian regions love to use gold as accessories in their daily lives," he was quoted by tempo.co as saying.

The new stores will serve as an addition to the company's already existing nine gold boutiques, comprising two in Surabaya and one in Jakarta, Bandung, Semarang, Makassar, Balikpapan, Banjarmasin and Palembang.

According to Tedy, gold is still a lucrative commodity to invest in.

He disclosed that on average, each of Antam's gold boutiques could sell 25 kilograms of gold per month.

"Our boutiques were even able to sell a total of 9.3 tons of gold last year," he said.

Aside from the aforementioned qualities of gold as an investment commodity, he attributed the sales figures to the ease in which people could purchase gold in Antam's boutiques.

He claimed that customers could complete transactions in Antam's gold boutiques within just 10 minutes.

Antam is setting its sights on reaching some 13.6 tons of gold sales this year, a 46 percent increase from its 9.3 tons of gold sales last year.

Gold is the biggest contributor to the company's unaudited net sales of Rp 1.16 trillion in the first quarter of 2014, or some 52 percent from the total net sales figures of Rp 2.22 trillion in the same period.

Meanwhile, Singapore is hoping for the Midas' touch in its ambitions to be a regional precious metals trading hub.

It is launching the world's first exchange-traded wholesale 25-kilobar gold contract.

"With our close proximity to both demand and supply in Asia, I believe that Singapore is well-placed to support the bullion industry, with substantive mutual benefits," said Singapore trade and industry minister Lim Hng Kiang at the London Bullion Market Association market forum.

"Our vision is that Asia can be a driving force to continue the growth of the bullion industry and be a global leader in areas fundamental to demand and trade in this region," he said as quoted by The Strait Times.

The system, which is expected to go "live" in September, will introduce the centralized trading and clearing of a physically delivered gold contract in Singapore.

The contract comprises a series of six daily contracts, enabling physical users' access to competitively priced kilobars.

But retail investors hoping to get a piece of the action will be disappointed - the contract is targeted at wholesalers for now.

At a hefty minimum size of 25 kilograms per lot, it will also not be easy for any retail investor to consider buying into the market as each lot comes at a price tag of US$1 million (S$1.25 million).

The price is not fixed and will be determined by demand and supply on the exchange, though the minimum price fluctuation per lot is $125.

The contract is the result of a successful collaboration between International Enterprise (IE) Singapore, Singapore Bullion Market Association (SBMA), Singapore Exchange (SGX) and the World Gold Council.

Representing the SBMA in the collaboration are four bullion banks, namely: JP Morgan, Standard Chartered, Standard Merchant and the Bank of Nova Scotia.

Last but not least, the Thailand Futures Exchange (TFEX) and seven Thai gold future brokerage houses recently launched a joint initiative to boost the gold futures trade.

This initiative enables investors to settle their expired contracts with physical gold. This will be applied to contracts issued from August this year onward.

Previously, investors could settle their expired contracts with cash only.

"It's an alternative to investors, gold shops and others who can use gold futures in determining the desired future of gold prices, without having to pay in full. The physical gold settlement should enhance flexibility and help them better balance their risk appetite," TFEX managing director Kesara Manchusree was quoted by The Nation as saying.

By The Jakarta Post

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