Editor’s Note
Recent reports of profitable gold arbitrage between Hong Kong and mainland China have drawn public attention. Our on-site verification found no evidence of the described large-scale purchasing activity in Hong Kong. While cross-border gold reselling does occur, the phenomenon appears more limited than some media portrayals suggest.
Recent media reports suggested that mainland netizens could profit by buying gold in Hong Kong and reselling it in Shenzhen, with potential daily earnings of up to 7,000 RMB per person for two round trips. Hong Kong 01 visited both sides of the border today (21st) to verify and found no long queues for gold purchases in Hong Kong. While a Shenzhen gold shop manager confirmed that both Hong Kong and mainland residents have been reselling gold recently, it has not sparked a major frenzy. Industry insiders stated that the recent depreciation of the RMB has led investors to shift assets into value-preserving products like gold, driving up mainland gold prices and creating a price gap of up to 7% between the two regions. However, the atmosphere for buying gold in Hong Kong and reselling in mainland China is not considered intense.
Mainland media outlet China News Service – JWealth recently reported on a Shenzhen netizen’s experience buying gold at a shop in Sheung Wan, Hong Kong. The report stated that due to a significant price gap between Hong Kong and mainland gold prices last week, buying gold in Hong Kong and reselling it at Shenzhen’s Shuibei, China’s largest jewelry trading market, could yield a profit of 16 to 17 RMB per gram. The individual and friends made multiple round trips between Hong Kong and Shenzhen within a week, reportedly earning over 7,000 RMB on a day with two trips.
A Hong Kong 01 reporter visited the outside of “Lee Cheong Gold Shop” in Sheung Wan this morning (21st) and observed no queue for gold purchases. However, a staff member said that the recent large price gap did attract mainland tourists buying gold for arbitrage, but the trend only lasted about a week.
According to Lee Cheong Gold Shop’s buying price this morning, the purchase price per tael of gold was 18,390 HKD. Mainland platform Rongtongjin’s real-time quote showed a gold recycling price of 472 RMB (approx. 506 HKD) per gram. After conversion, the selling price per tael in mainland China is about 18,960 HKD, a difference of roughly 570 HKD compared to Lee Cheong’s buying price.
The reporter also visited the Shuibei Jinzhan Jewelry Plaza in Shenzhen, finding many counters and shops advertising “old gold recycling” or “high-price recycling” alongside selling gold jewelry. A staff member at one shop, Pan Baola, confirmed that some people have recently been profiting from the price difference due to rising mainland gold prices, but foot traffic hasn’t increased significantly.
Another mainland resident planning to sell gold jewelry said they were simply cashing in on the high price to sell unused items like dragon and phoenix bangles bought for weddings.
Haywood Cheung, Chairman of the Chinese Gold & Silver Exchange Society, said the phenomenon of buying gold in Hong Kong for resale in mainland China for profit emerged last month, but the atmosphere is not overly intense. He explained that RMB depreciation and a sluggish mainland property market have led investors to shift funds into safe-haven assets like gold, driving up domestic gold prices.
He also noted that the current mainland gold recycling price is about 5% to 7% higher than Hong Kong’s gold price, a gap encouraging arbitrage. He expects this situation to continue until year-end but cautioned that there are restrictions on carrying gold across the border, and resellers should avoid breaking the law.
Liu Kebin, General Manager of Greater China Operations for Chow Sang Sang, pointed out that the absence of consumption tax and VAT in Hong Kong makes retail gold prices there about 5% to 6% cheaper, traditionally attracting many mainlanders to shop specifically in Hong Kong. However, he said the group has not recently observed the large-scale gold buying for resale profit as reported by mainland media.
According to the latest Shenzhen Customs regulations, both mainland and Hong Kong resident travelers entering the mainland are allowed to carry gold and its products for personal use within reasonable quantities. The specific determination standard is judged by customs officers at the entry port, and declaration to customs is required upon entry. According to relevant regulations, gold and its products exceeding personal use and reasonable quantities are treated as imported goods. Customs will levy taxes and release them upon presentation of approval documents from the People’s Bank of China. Without such documents, the handling method is decided by the entry port customs. Generally, if the value of随身携带的物品 exceeds (or equals) 5,000 RMB, supplementary taxes are required.