On Friday the World Gold Council announced plans that have produced a draft framework of standards designed to combat gold that enables, fuels or finances armed conflict. Not a million degrees different from the concept taken up by the diamond industry (blood diamonds). The new standards enable miners to produce newly mined gold which is certified as “conflict free” on a global basis. This of course can only apply to newly mined gold, any gold in current circulation is somewhat out of the loop. This is a good initiative and frankly, a little late in the day, but finally we have something.

The draft standards have been “stress tested” by many of the leading gold mining companies and refineries. The World Gold Council invites participation in its press release: “The World Gold Council recognises the multi-faceted nature of this initiative and is seeking input that will foster a collaborative and comprehensive solution and is, therefore, undertaking consultations with stakeholders. Interested parties including governments, NGOs, the investment community, artisanal miners, end-users and other participants in the gold supply chain are being invited to review the draft standards and to provide their feedback by 1 September 2011. There will also be continuing work and dialogue on related issues such as recycled gold, audit and assurance.”

We have seen much change in the world and political unrest is rather more “normal” in some countries than others. Gold has been a fantastic investment over recent years, but no one wishes to see it used to fund conflict. Of course a realist might suggest that gold, like any other precious resource has, does and can be a key source of conflict. Anyone with a History O’Level will understand something of this when thinking of the Spanish Armada, the New World and The 1849 Californian Gold Rush. However, this is surely a good and sensible initiative, albeit overdue.

The price of gold was fairly “flat” from 1900 until the mid 1970’s when the dramatic rise in price began, peaking in the early 1980’s before effectively collapsing until the new millennium, the price has rocketed by around 394% in the last 10 years from an average £184.09 to £792.41 in 2010.

Here’s a few interesting facts. One ounce of pure gold could be hammered into a single sheet nine metres square. Gold melts at 1064 degrees centigrade and boils at 2808 degrees centigrade. It is estimated that 165,000 tonnes of gold have been mined since the beginning of civilisation – which would fit into a crate of 20 cubic metres.