The Direct Economic Impact Of Gold

A new independent research report, The direct economic impact of gold, from PwC commissioned by the World Gold Council, reveals striking insights into the direct economic contribution of gold in the world’s major gold producing and consuming countries. This research is ground-breaking in the breadth of its perspective, covering the entire value chain of the gold industry, from mining and refining to end-user consumption.

The research reveals that supply and demand for gold makes a consistently positive contribution to global economic growth. Overall, in 2012, at least US$210 billion of value was created by the gold industry and added to global GDP.

Consumer demand for physical gold products – jewellery and small bars and coins – is estimated to have directly contributed around US$110 billion in 2012 to the world economy.

Another key finding of the research is the significance of gold mining to the economies of developing nations. PwC estimate that gold mining made an economic contribution of over US$78.4 billion to the economies of the top 15 mining countries in 2012. Proportionally, however, gold mining has the most substantial impact on growth and wealth creation in developing countries; greatest in Papua New Guinea (15% of GDP), followed by Ghana (8% of GDP) and Tanzania (6% of GDP). For these nations, gold is also a major source of exports and, therefore, foreign exchange earnings. In 2012, gold provided 36% of all Tanzanian exports and 26% of the exports of Ghana and Papua New Guinea.

The scope of the research only extends to examining direct economic impacts; it excludes consideration of indirect contributions to national economies from additional taxes, secondary employment and social and infrastructural development. Furthermore, it does not attempt to measure the economic impact of less formal and artisanal gold production.

Also, when looking at gold investment products, PwC did not attempt to measure the economic impact of holding gold in investment portfolios, although the World Gold Council has produced a sizeable body of research addressing this subject (see, for example, our Investment Research publications).