Previous Year Question
Consider the following statements:
Statement-I: Switzerland is one of the leading exporters of gold in terms of value.
Statement-II: Switzerland has the second-largest gold reserves in the world.
Which one of the following is correct in respect of the above statements?
Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I
Both Statement-I and Statement-II are correct and Statement-II is not the correct explanation for Statement-I
Statement-I is correct but Statement-II is incorrect
Statement-I is incorrect but Statement-II is correct
Correct Answer: C
Detailed Solution
Statement I is correct.
Switzerland is not a major gold-mining country, but it is a leading global centre for gold refining, processing and international trading. Several of the world’s major gold refineries are located there.
The trading process generally operates as follows:
Switzerland imports doré bars, low-purity gold or previously refined gold from producing and trading countries.
Swiss refineries convert it into high-purity gold bars.
The refined gold is exported to major markets such as China, India, Türkiye and Hong Kong.
According to the Swiss Federal Office for Customs and Border Security, Switzerland exported approximately 1,564 tonnes of gold, valued at about CHF 87.9 billion, in 2023. Citing UN Comtrade data, the Swiss authority identified Switzerland as the world’s largest gold importer and exporter by value in 2023. Hence, Statement I is correct.
Statement II is incorrect.
Gold exports and official gold reserves are different concepts:
Gold exports include gold imported for trading, refining and subsequent re-export.
Official gold reserves refer to monetary gold held by a central bank or government as part of its currency reserves.
The Swiss National Bank holds 1,040 tonnes of gold. Several countries, including the United States and Germany, hold official gold reserves considerably larger than Switzerland’s. Therefore, Switzerland does not possess the world’s second-largest gold reserves.
Current position: The Swiss National Bank’s annual result published in March 2026 confirmed that its gold holdings remained unchanged at 1,040 tonnes at the end of 2025. Approximately 70% is stored in Switzerland, 20% at the Bank of England and 10% at the Bank of Canada.