Everyone knows that the emerging market (and not just India and China) has an insatiable appetite for physical gold. But the latent demand is significantly greater than what has been seen to date. In our journey to date, potential partners from Asia to Africa and beyond have talked to HelloGold about how the right kind of digitised gold product, when marketed and delivered in the right way, can catalyse a whole new customer segment. This hypothesis has been reaffirmed in the market studies that we have conducted in our launch markets.
The gold industry finds itself at an inflection point between the recent era of cost-out initiatives and balance sheet deleveraging, and an increasing need to focus on growth and the replenishment of depleting gold reserves. After a period of impairments, write-downs and value destruction, shareholders in search of improved returns and greater management accountability are unlikely to support significant M&A programs. The future strategic options to drive growth will differ across industry players but all will need to consider a mix of organic and inorganic approaches if they want to return to growth in an economic and sustainable way.
The Tides They Are a-Changin’”: This slightly adjusted title of Bob Dylan’s famous song is a fitting opening to our summary of this year’s In Gold we Trust report.
Quantitative tightening, de-dollarization, and cryptocurrencies seem to be echoing the strains of R.E.M.’s “It’s the End of the World as We Know It”. Whether we find this changing of the tide good or bad is of no relevance to the phenomenon itself.
What is unfolding will affect our lives either way. But the better we brace ourselves for these fundamental changes, the more we will be able to benefit from them. The key findings may be summarized in terms of the following three changings of the tide:
Increased stakeholder and investor pressures, as well as civil society scrutiny, critically impact decision-making and project development in the extractive industry. ‘Securing stakeholder outcomes: the seven habits of highly effective executives’ looks at examples of how good ‘habits’ can achieve positive political and stakeholder outcomes in the mining sector, and protect or enhance project value in uncertain, volatile or otherwise complex contexts.