Gold By Country:
2013 Demand: 140.1 tonnes
Jewelry/Coin & Bar Demand: 3.5 tonnes/136.6 tonnes
Reserves: 152.4 tonnes
% of Total Forex Reserves: 4.11%
2013 GDP: $674 billion
Thailand is experiencing rapid economic growth and is the 2nd most productive nation in the South Pacific by a number of different indicators. With rising levels of wealth, the country's long-time fascination with gold and metalworking is showing up in its avid consumption of the yellow metal. Thailand has recently experienced a dramatic jump in its domestic gold demand and, with this development, is seeking to make the country a more relevant player in the global economy.
Thailand was originally known as Siam, which translates to “gold” in the Sanskrit language. The Ancient Chinese similarly dubbed it “the gold peninsula.” Its capital, Bangkok, is also home to the largest solid gold statue in the world, the Golden Buddha. (This 5-tonne statue was covered by decorative plaster when it was recovered from ruins at the turn of the 19th century. It was on display for over a century before an accident revealed gold beneath the stucco. Its gold content is currently valuated at over $225 million.) In a manner similar to Turkey and Egypt, Thailand has developed an historical intimacy with gold that lives on through the beliefs and practices of its people.
The standard unit of gold measurement in Thailand is the baht, equivalent to 15.244 grams as raw bullion, or no less than 15.16 grams for jewelry. Most commonly, 10 baht gold bars are the preferred form of trade for formal transactions. These transactions are conducted using the official spot price for Thai gold, as determined by the Thai Gold Traders Association. This price can only be adjusted in increments of 50 baht. (“Baht” is also the name for the Thai currency.) This 50-baht threshold for moving the spot price minimizes the constant fluctuations of the global gold market; and, once decreed, the new price must be reflected in all gold shops.
The most popular place to buy gold is Yaowarat, the main thoroughfare in Chinatown, with over 130 gold shops lining this main street. An incredible diversity of gold jewelry, usually 23 karats, is available from these vendors.
Nearly all Thai demand for gold (140.1 tonnes in 2013) was for investment bars and coins (136.6 tonnes) rather than jewelry. Presumably, this allocation of demand reveals the importance of gold purity to the Thai people, as well as their predilection to furnish their own jewelry in distinctly Thai style rather than buy gold elsewhere. Although 18-karat gold jewelry of the Western style is becoming more common, Thai gold is typically 96.5% pure, or about 23 karats.
Like Egypt, Thailand bears a cultural legacy of intricate gold-working, laying claim to its own historic fabrication styles known as Sukhothai and Phetchaburi. Another traditional Thai form of gold is the honeycomb bar, which features a crackled surface that is produced by blowing on the gold as it cools. This process was employed to allow buyers to see beneath the bar's outer layer and verify that real gold lay beneath.
Did You Know?
Thailand is home to the Golden Buddha, the largest solid gold statue on earth. Weighing 5.5 tonnes, the statue's body is composed of 40% pure gold, its face is 80% pure, while the hair and everything above contains 99% pure gold. Initially covered in plaster when recovered from ruins around 1800, it was not until the 1950s that it was discovered to be gold beneath the outer layer. While being moved, the statue was accidentally dropped, cracking the concrete casing and revealing the glint of gold. Thailand is also known for producing gold bullion coinage, specifically the gold baht. The baht comes in a wide range of denominations from as little as 600, or as high as 4,000.