Hello, dear readers of the Tyulyagin project! In my recent article, I discussed the world's gold and foreign exchange reserves, which include monetary gold, reserve currencies, SDRs, and IMF reserve positions. Today’s article will focus specifically on gold and the physical volume of this precious metal. I will explain in more detail what a stock of gold and why modern states need it. I will also present the ranking of the top countries in the world by gold reserves in the table for the end of 2021 - beginning of 2021.
What is gold reserve and what is it for?
As I already wrote in my article about gold and foreign exchange reserves, gold reserves or gold reserves are one of the important components of gold and foreign exchange reserves. In other words the gold reserve is the state’s reserve, part of its gold and foreign exchange reserve expressed in gold. Gold reserves are most often stored in bullion.
The largest holders of gold reserves are states and international financial organizations, but in addition to them, there are also private reserves. For all time, the total volume of gold mined by man is about 190-200 tons, with most of it mined over the past 70 years. The volume of the total gold reserves of all countries of the world is currently about 35 tons.
In states, gold reserves are under the control of the Central Bank or the Ministry of Finance. In total, they own about 20-25% of all gold in the world.
The largest international financial institutions that hold gold include the IMF, the ECB and the Bank for International Settlements.
Information about private owners of gold is unofficial, but according to rough estimates, about 1,800 tons of gold belong to various investment funds around the world. So one of the largest is the ETF fund SPDR Gold Shares
For most of human history, gold was the main financial asset, it caused conflicts and wars between states, and gold was the main prize.
Debate over the importance of gold reserves in the modern economy has grown rapidly in recent years. Many believe that after the decoupling of world currencies from the gold standard and the fall of the Bretton Woods system, the presence of a gold reserve is nothing more than political games and satisfying the ambitions and pride of politicians. Nevertheless, most countries with leading gold reserves are in no hurry to sell it, and developing economies, especially China and Russia, are rapidly increasing their reserves. In this regard, there is an opposite point of view that the state’s gold reserves are one of the main factors in its independent policy and development strategy, as well as a claim to greater power and position in the world.
The advantages of investing in gold are obvious. First of all, gold is a tangible asset and a real commodity, its quantity is limited and it (the asset) is not subject to inflation, unlike traditional fiat currencies. The gold reserve allows the state to diversify its reserves and reduce dependence on foreign reserve currencies. The precious metal also allows you to provide loans and protect the economy from inflation. In other words, the gold reserve makes it possible to make the economy more stable in the face of volatility in global and local markets, and makes the national currency exchange rate more stable and independent. In addition, gold can be used as a means of payment.
In general, returning to the debate about the importance of gold, I am of the following opinion: the greater the state’s gold reserves, the greater its economic independence .
India
- Tons: 657.7
- Percentage of gold and foreign exchange reserves: 7.5%
It is no surprise that Bank of India has one of the largest gold deposits in the world. With a population of 1.25 billion, South Asia is the second largest consumer of precious metals and one of the most reliable drivers of global demand.
Top countries in the world by gold reserves in the table
In recent years, the availability of gold reserves and its size have again acquired high significance if we analyze the dynamics of reserves in countries around the world. In addition, in recent years, the repatriation of gold reserves of many countries from the USA and England has begun. In recent years, Türkiye, Germany, and Poland have become striking examples of gold repatriation. The share of gold reserves in gold and foreign currency reserves for such developed economies as Germany, Italy, and France exceeds 50%, and in the United States it even reaches 79% of all the country’s reserves. We can say that over the past decade, starting with the 2008 crisis, a new global trend has emerged to increase gold reserves . So in 2021 alone, the demand for monetary gold from the world’s central banks increased by 74% and amounted to 148 tons, the growth continued in 2021, and in the first half of the year the world’s central banks purchased almost the same amount - 145 tons. All this once again points to the important role of gold reserves in the global economy and politics.
However, not everyone is increasing their gold reserves. Often states that are experiencing enormous financial difficulties sell gold reserves. For example, Venezuela sold 25 tons of its gold reserves in 2021 alone. Tajikistan, Mongolia, and Uzbekistan are also selling their gold reserves.
A complete list and statistics of gold reserves in countries around the world is presented in the table below. I also indicated the share of gold reserves in the total amount of gold and foreign currency reserves. The top 10 countries in the world for December 2021 include: USA, Germany, Italy, France, Russia, China, Switzerland, Japan, India and the Netherlands. The gold reserves of the top ten countries in the world account for more than 70% of the world reserves of all countries. The table does not contain data on Iran's gold reserves, since there are no official estimates; according to unofficial estimates, Iran's gold reserves vary greatly and are estimated from 300 to 900 tons of gold.
| № | A country | Gold reserves, tons | Share of gold in gold and foreign currency reserves, % |
| 1 | USA | 8133.5 | 77 |
| 2 | Germany | 3366.5 | 73 |
| IMF | 2814 | ||
| 3 | Italy | 2451.8 | 66.3 |
| 4 | France | 2436 | 60.2 |
| 5 | Russia | 2261.6 | 20,2 |
| 6 | China | 1948.3 | 2.9 |
| 7 | Switzerland | 1040 | 6 |
| 8 | Japan | 765.2 | 2.8 |
| 9 | India | 618.2 | 7 |
| 10 | Netherlands | 612.5 | 68.3 |
| ECB | 504.8 | 29.5 | |
| 11 | Taiwan | 423.6 | 4.2 |
| 12 | Türkiye | 398.2 | 19.9 |
| 13 | Portugal | 382.5 | 74.8 |
| 14 | Kazakhstan | 377.4 | 62 |
| 15 | Uzbekistan | 338.7 | 58 |
| 16 | Saudi Arabia | 323.1 | 3.1 |
| 17 | Great Britain | 310.3 | 8.6 |
| 18 | Lebanon | 286.8 | 26.1 |
| 19 | Spain | 281.6 | 18.3 |
| 20 | Austria | 280 | 55.8 |
| 21 | Belgium | 227.4 | 34.8 |
| 22 | Philippines | 197.9 | 10.7 |
| 23 | Algeria | 173.6 | 7.6 |
| 24 | Venezuela | 161.2 | 77.4 |
| 25 | Thailand | 154 | 3.1 |
| 26 | Poland | 128.6 | 4.5 |
| 27 | Singapore | 127.4 | 1.8 |
| 28 | Sweden | 125.7 | 8.5 |
| 29 | South Africa | 125.3 | 10 |
| 30 | Mexico | 120 | 2.8 |
| 31 | Libya | 116.6 | 5.6 |
| 32 | Greece | 113.1 | 61.4 |
| 33 | Korea | 104.4 | 1.1 |
| 34 | Romania | 103.7 | 10.1 |
| Bank for International Settlements | 102 | ||
| 35 | Iraq | 96.3 | 6.7 |
| 36 | Kuwait | 79 | 8.1 |
| 37 | Indonesia | 78.5 | 2.8 |
| 38 | Egypt | 78.3 | 7.3 |
| 39 | Australia | 68.7 | 5.2 |
| 40 | Brazil | 67.4 | 0.7 |
| 41 | Denmark | 66.6 | 3.8 |
| 42 | Pakistan | 64.6 | 22.5 |
| 43 | Argentina | 54.8 | 3.4 |
| 44 | Finland | 49.1 | 19.6 |
| 45 | Belarus | 46.9 | 25.6 |
| 46 | Bolivia | 42.5 | 19.6 |
| 47 | Bulgaria | 40.4 | 5.8 |
| 48 | Malaysia | 38.9 | 1.6 |
| 49 | Peru | 34.7 | 2.5 |
| 50 | Slovakia | 31.7 | 24.9 |
| 51 | Hungary | 31.5 | 4.1 |
| 52 | Qatar | 31.3 | 4.2 |
| 53 | Syria | 25.8 | 6 |
| 54 | Ukraine | 24.3 | 4.8 |
| 55 | Also Kistan | 22.3 | 68.8 |
| 56 | Morocco | 22.1 | 3.8 |
| 57 | Afghanistan | 21.9 | 11.3 |
| 58 | Nigeria | 21.4 | 2.1 |
| 59 | Serbia | 20.3 | 6.3 |
| 60 | Sri Lanka | 19.9 | 9.5 |
| 61 | Mongolia | 15.1 | 18 |
| 62 | Bangladesh | 14 | 1.8 |
| 63 | Cyprus | 13.9 | 61.9 |
| 64 | Curacao | 13.1 | 30 |
| 65 | Colombia | 12.8 | 1.1 |
| 66 | Cambodia | 12.4 | 3.9 |
| 67 | Mauritius | 12.4 | 8.1 |
| 68 | Ecuador | 11.8 | 17.7 |
| 69 | Kyrgyzstan | 10.8 | 21 |
| 70 | Czech | 8.8 | 0.3 |
| 71 | Ghana | 8.7 | 6 |
| 72 | Paraguay | 8.2 | 4.4 |
| 73 | UAE | 7.5 | 0.3 |
| 74 | Myanmar | 7.3 | 5.6 |
| 75 | Macedonia | 6.9 | 8.6 |
| 76 | Guatemala | 6.9 | 2.3 |
| 77 | Tunisia | 6.8 | 5.7 |
| 78 | Latvia | 6.6 | 6.2 |
| 79 | Ireland | 6 | 4.7 |
| 80 | Lithuania | 5.8 | 4.1 |
| 81 | Bahrain | 4.7 | 8.7 |
| 82 | Brunei Darussalam | 4.5 | 5.6 |
| 83 | Mozambique | 4.4 | 5.5 |
| 84 | Slovenia | 3.2 | 14 |
| 85 | Aruba | 3.1 | 13.4 |
| 86 | Bosnia and Herzegovina | 3 | 1.8 |
| 87 | Luxembourg | 2.2 | 9.8 |
| 88 | Hong Kong | 2.1 | 0.006 |
| 89 | Iceland | 2 | 1.3 |
| 90 | Papua New Guinea | 2 | 4.2 |
| 91 | Trinidad and Tobago | 1.9 | 1 |
| 92 | Haiti | 1.8 | 3.5 |
| 93 | Albania | 1.6 | 1.7 |
| 94 | Yemen | 1.6 | 1.3 |
| 95 | Salvador | 1.4 | 1.5 |
| 96 | Suriname | 1.4 | 9.8 |
| 97 | Laos | 0.9 | 3.8 |
| 98 | Solomon islands | 0.7 | 5.2 |
Gold as one of the very first financial instruments
As production develops and strong trade links are established, the importance of gold increases. Thus, ensuring the economic and political flourishing of the eras of the Ancient, Middle and New Kingdoms
, thanks to the presence of metal deposits in Nubia, gold actually took on the role of a means of purchase and payment.
And all because there was simply no other currency (with the exception of a number of other precious metals) in those days. Commodity relations based on the exchange of some natural products in the form of livestock, grain, fruits and vegetables for others, again required the creation of a system of price and value, the measure of which could only be gold. With the emergence of the state and the accumulation of wealth, both in private hands and in the treasury, it took on the role of a measure of values. After all, it was with its help that many countries’ expenses for public needs were covered.
Around the same time, the prototypes of modern coins appeared - gold bars of a certain weight with the name of the ruler stamped on them
. The first of them, apparently, was the Egyptian pharaoh Menes I. Over time, the role of precious metals (gold and silver) in monetary circulation increased, which was greatly facilitated by great geographical discoveries and the discovery of ever new gold deposits.
Russia's gold reserves
We can say that Russia launched the current global trend towards increasing gold reserves, which I wrote about at the beginning of the article. Since 2006, long before the Global Crisis of 2008-2009, Russia has been systematically increasing its gold reserves and the share of monetary gold in gold and foreign currency reserves. So from 2006 to 2021 it grew more than 5 times; in 2006, the gold reserve was only 386 tons, and today Russia’s gold reserve is 2261.63 tons of physical gold. If we talk about records, then there is still something to strive for, since the record for gold reserves was achieved in 1941, when the volume reached 2800 tons. You can see the dynamics of changes in gold reserves in the graph below.
Gold reserves of the USSR and Russia from 1941 to 2021. Click on the graph to enlarge
However, in the entire history of modern Russia, the current figure of 2261.63 tons is a record value. In monetary terms, Russia's gold reserves in 2021 exceeded $100 billion, and the share in gold and foreign reserves is about 20%. The gold reserves at the beginning of 2021 look especially significant compared to what they were at the beginning and mid-90s. For example, in 1995, the volume of physical gold was only 262 tons. I demonstrated the full dynamics of Russia's gold reserves in the graph below.
Russia has been a leader in increasing gold reserves over the past few years. From January to December 2021 alone, Russia purchased 148 tons of gold. If growth continues at the same pace, then in the next two years, Russia will move from 5th to 3rd place among all countries in the world after the USA and Germany, while overtaking France and Italy.
Where is the Russian Gold Reserve located?
Two-thirds of Russia's gold reserves are stored in the Central Bank's central vault on Pravdy Street in Moscow. In addition to it, there are a number of interregional storage facilities, for example in St. Petersburg and Yekaterinburg, there are more than 600 of them in total. According to the Central Bank of the Russian Federation, the central storage facility is reliably guarded and protected, which is why information about where the bulk of Russia’s gold reserves is stored is not hidden. However, there are also unofficial data and rumors that part of Russia’s gold reserves are stored in the USA and Switzerland, but I have not found confirmation of this information.
Italy
- Tons: 2451.8
- Percentage of gold and foreign exchange reserves: 71.3%
Italy has also maintained its reserves over the years by helping Mario Draghi, the president of the European Central Bank (ECB). When a reporter asked about the role of gold in the Central Bank's portfolio in 2013, the former head of the Bank of Italy responded that the metal was a “safety margin” and added: “It provides a pretty good hedge against dollar fluctuations.
Gold reserves of the USA, Germany and China
US gold reserve
The United States has been the undisputed leader in gold reserves for several decades. The current gold reserve is 8133.5 tons, or about 77% of the total US gold and foreign exchange reserves. The amount of gold reserves has been at the level of 8,000 tons for many years, since the mid-1970s. The peak of US reserves occurred in the post-war years 1945-1951 and exceeded 20,000 tons. Most of the US gold reserves, over 4.5 tons, are located at the Fort Knox military base. It is believed that, largely thanks to its gigantic gold reserves, the United States maintains the stability of its national currency, the dollar.
Among other things, the US vaults contain a large amount of gold reserves of other countries: about 36% of the reserves of Germany, 43% of the reserves of Italy, 31% of the gold reserves of the Netherlands, and the reserves of many other countries of the world.
Germany's gold reserves
Germany is the leader in gold reserves among European countries. At the end of 2021, its reserves are equal to 3366.5 tons or about 73% of all gold and foreign reserves. For a long time, most of Germany's gold reserves were stored in the United States, France and England. However, starting in 2013, the repatriation of gold from foreign countries began. Currently, just over half (50.6%) of the gold is in Frankfurt in the vaults of the Bundesbank. At the same time, 36.6% of Germany's gold is still located in New York and 12.8% in London.
China's gold reserves
China's gold reserves are 1948.3 tons. Despite the fact that China is the leader among countries in gold and foreign exchange reserves, the share of gold reserves is only 2.9%. Despite this, China, like Russia, has begun to significantly increase its gold reserves in recent years; since the beginning of the 2000s, they have grown 5 times - from 400 to 1900 tons. According to unofficial data, China's gold reserves are stored in Beijing.
And that’s all for today about gold reserves in countries around the world. Add the site to bookmarks and subscribe to new interesting articles by e-mail. Good luck friends, and see you again on the pages of the Tyulyagin project !
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Netherlands
- Tons: 612.5
- Percentage of gold and foreign exchange reserves: 71.4%
The Dutch central bank has announced that it will move its gold vaults from Amsterdam outside the city, about an hour's drive from the capital, citing excessive security measures at their current location. This seems strange given that the bank recently repatriated a large amount of gold from the US.
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