Azerbaijan, Baku, September 29 / Trend /
Leyla Abdullayeva, expert of Trend analytical center
Increasing of world prices for gold, which early this year reached nearly $900 per troy ounce, and from 2000 to 2009 increased more than three times (from $300 to $1000), is extremely beneficial for Azerbaijan, already as manufacturer and exporter of this metal.
Because together with the American company R.V.Investment Group Services LTD, which develops Gadabay gold field in the west of the country, this year Azerbaijan already began to export gold to world markets through the European exchanges. The first consignment of gold worth $977 per ounce was sent to world markets through the European exchanges. Exports began with a volume of 1200 - 2000 ounce of gold under the brand of Ayrim, and by the end of 2009 can reach 65,000 ounces (over 2.0 tons). In 2010, the volume will reach 75,000 ounces, a few years later - 100 000.
Reserves of the industrial fields in Azerbaijan are mainly in the form of alluvial gold. It is important to note that the exploitation of alluvial fields is quite perspective in the economic and technological terms. Development of placer gold has several advantages over the development of ore, carried out on large fields: it is possible to get high-grade gold, while avoiding the costs of fragmentation, enrichment and development of technological processes. In addition, electricity consumption is saved. Also production of placer gold is more secure because of the lack of blasting operations.
Therefore, in the case of a successful combination of circumstances and considering the annual rise in prices of yellow metal, Azerbaijan can to earn good money even if the prices fall. Once again, experts predict that a rise in price of gold is expected in the end of 2009. Gold commentators try to outdo each other gradually in the higher gold price forecasts, which predict a rise to $ 2000 per ounce, and some even suggest that the price in the Dow (Dow Jones index) will come to $3000 per ounce.
Today, in Azerbaijan the volume of total reserves of gold is 500 tons. If to compare Azerbaijan's gold reserves with the global giant gold exporting countries, for instance with Republic of South Africa, where the annual export amounts to some 500 million tons, Azerbaijan's reserves in this respect is rather less. Undoubtedly Azerbaijan will face with the competition of many developing countries in this regard. In today's market there are large producers of gold as Republic of South Africa, USA, Australia, Canada, China and Indonesia, which are steadily increasing production of gold and soon may catch up with major producers - Peru and Uzbekistan.
In this situation, the government directly or indirectly should support and encourage the development of this industry. For example, the situation can be mitigated by lowering the level of duty on the export of gold, which is now 15 percent in Azerbaijan. In Russia, the five-percent export duty on this precious metal, for example, was canceled. With this step, the Government of Azerbaijan would create a equal conditions for exporters. Reducing tariffs will have a positive impact on the gold market in general, because it will help attract the industry of cheap foreign financing, which is especially important for the development of ore fields.
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