Gold, the world's most popular metal, is a phenomenon with historical, social, economic and religious dimensions. This valuable metal has throughout history been regarded as a standard of exchange and of buying and selling; today there are various uses for gold. Gold and jewelry are also popular as the most important decorative goods in many societies.
In some religions, such as Hinduism, gold is sacred. Gold is also a means of sanctification and is widely used in Buddhism to decorate Buddha statues and temples. In Iran and Iraq, too, gold is used to decorate shrines. In many regions it is also, traditionally, the customary and common gift at celebrations and weddings. Buying gold is a guarantee of preserving or increasing the value of assets. At a time when inflation continually erodes the value of countries' national currencies, buying gold and storing it is a way to escape inflation and a support for people in periods of economic instability. In this piece we intend to examine the roots of gold and jewelry consumption in three of the largest gold-consuming countries.
Turnover of the gold and jewelry industry worldwide
Studies show that the cash turnover of the amount of gold used in jewelry is 280 billion dollars. The turnover of gemstones worldwide is 700 billion dollars, while in 2022 the value of the jewelry market overall was about 270 billion dollars. This figure is forecast to reach 332 billion dollars in 2026.
In the final quarter of 2019, Iran was one of the 10 leading countries in gold and jewelry consumption. India, China and the United States rank first to third in gold and jewelry consumption, and South Korea, Iran and Italy have taken ranks eight through ten. China, India and the United States are, in that order, the world's largest consumers of gold and jewelry, so that more than 50 percent of world gold demand is accounted for by these three countries. After them, countries such as Germany, Thailand, Turkey and Vietnam have substantial gold and jewelry consumption. The statistical database Statista named India as having the highest demand for gold in 2022. More interestingly, in this chart the West Asia region is the third region in terms of the volume of gold demand.
Gold consumption in China, the largest gold consumer
High gold consumption in China is very similar to that in India. For example, China too has a class-based social system, and the aristocratic classes display their financial superiority through jewelry. Factors such as the marriage process sharply increase the volume of demand for gold and jewelry. With the growth of the middle class, the volume of liquidity and disposable capital also increases, making it possible to spend this capital on luxury goods such as gold and jewelry. A 2021 survey showed that nearly 90 percent of couples had bought jewelry and more than three-quarters of them had bought a wedding ring. China's turnover from the gold and jewelry market is more than 85 billion dollars. This figure is unmatched in the world and makes China the highest-earning country from gold and jewelry and the world's largest gold consumer.
Gold consumption in India
The Indus Valley in India, as a 5000-year-old civilizational sphere, has, because of jewelry extraction, made this country a major producer, exporter and consumer of gold and jewelry. About 50 percent of gold demand and consumption in India is related to gifts exchanged at wedding ceremonies. For that reason, weddings and special ceremonies account for a large share of gold consumption in India. In this country, because of the class-based social system, the aristocracy and the wealthy introduce themselves through the use of gold jewelry.
In India, besides gold consumption, silver, which is called poor man's gold, is also in high demand. Most silver consumption goes into making precious vessels and jewelry. Jewelry in India is also used to decorate temples, and gold is regarded as sacred by the Jain and Hindu religions.
Gold consumption in the United States
At present the largest volume of gold, silver and jewelry imports takes place in the United States. The use of gold and silver in industry is one of the factors that increase gold and silver consumption in the United States of America. For example, gold is used across a wide range for electronics and aerospace. Buying luxury goods, creating a safe asset in inflation, and traditional customs based on gold are among the reasons that make the United States a major gold consumer. In 2021 this country was the world's sixth-largest jewelry exporter. In the same year the US jewelry market was worth about 70 billion dollars. It is said that by 2021 a total of about 19100 jewelry stores were operating across the country.
The chart below shows the world's largest consumers and importers of gold and jewelry.
India, the world's most golden place
In many different religions gold is itself sacred, or is regarded as a symbol of the glory of sanctity for honoring religious places and symbols. Gold in itself is especially sacred for Hindus. The use of jewelry for the people of India has indicated purity and divinity, and they believe that gods and goddesses lived in golden palaces. There are unique structures and attractions in India. The most striking and unusual tourist attraction of the subcontinent is a building in the Indian state of Punjab. Likewise, the Sikhs' Golden Temple (Darbar Sahib) is their most sacred place and the manifestation of the sanctity of their belief, which takes the breath away from every viewer.
Gold's link with religion is one of the answers that can be found to the question of why gold consumption in India is so high. The outer walls of the Darbar Sahib temple, except for a narrow band at the bottom, are made entirely of pure gold. The dome and the small minarets above it are also completely gilded. That is because in Indian religions such as Sikhism and Hinduism, the use of gold is a symbol of grandeur and sanctity.
Gold and jewelry consumption in Iran
In recent years, with the onset of severe inflation in the country, people have widely turned to investing in the dollar, gold and property. For that reason, the purchase and consumption of gold ornaments in the country has become very high. It is said that in the past 10 years gold and jewelry have gained a special place in Iran, and in 2016 Iran was the world's sixth-largest gold consumer. Because of existing resources and mines, Iran has high potential for producing and consuming gold. To date only 74 gold minerals have been discovered and identified in Iran.
According to studies, gold bracelets rank first among Iranians' most popular ornaments, and gold earrings and chains rank second and third among the most popular Iranian gold jewelry. Turquoise stone is also very popular with people in our country. Iranian ethnic groups, at wedding ceremonies, sometimes spend their wealth in a striking way on buying gold and giving gold and ornaments as gifts. Iranians also have particular beliefs about some semi-precious stones. For example, agate stone is for Iranians a symbol of religious observance.
In 2018 the United States, with 8 thousand and 407 tons of gold, had the largest gold reserves. Germany with 3 thousand 483 tons and France with 2 thousand 518 tons are in second and third place for the largest gold reserves. According to statistics from the Mines and Mining Industries Development and Renovation Organization, gold extraction in Iran reached 1 thousand and 128 kilograms. In that year Iran's rank in gold was accompanied by 13 percent growth.
Conclusion
Every culture, depending on its customs, uses gold and jewelry, but gold throughout the world is a symbol of preciousness and value. Among them, some countries and regions consume more gold than other parts of the world. For example, countries such as India and China and the West Asia region, or the Middle East, are of this kind. Among the reasons for high gold and jewelry consumption in these regions, cultural customs can be cited. For example, in China and India, gold is widely used as a gift in the marriage process. For instance, about 50 percent of gold consumption in India is related to marriage. This metal is also used in religious places such as temples and shrines. In the United States and developed countries, the middle class has income beyond everyday needs; they usually spend their money on luxury goods such as gold. Gold is also a good option for investment and saving.
The world's largest gold importer is the United States of America. This country is also the sixth-largest exporter of this metal. The world's highest-earning country from gold and jewelry is China, but India is estimated to be the country with the highest demand for this industry. Our country, Iran, is also one of the world's large consumers of gold and jewelry, so that in 2016 Iran took sixth place on the list of major gold consumers.
Sources
Global Jewelry Market - Statistics & Facts
www.statista.com
Machine-translated from Persian by Namafar; the Persian original is authoritative. Read the original in Persian