Switzerland last year exported $132 billion of gold

Latest data from the World Gold Council shows demand from top gold consumers China and India slowed dramatically in the first quarter of this year.

While clearly calming down from the torrid pace last year, the movement of gold and silver from West to East continue to transform the global gold market in fundamental ways.

The process playing itself out goes roughly like this:

ETF investors in the US and other developed markets offload their gold holdings allocated to them and held in the UK, where most of the world's gold vaults are to be found.

From the UK the bullion is exported to Switzerland where the globe's gold refineries are concentrated, where it's melted down and recast into smaller bars.

Then the bullion is shipped to China and India and other growing gold consuming nations in Asia led by Vietnam and Indonesia.

Up until recently buyers in Asia were also willing to pay high premiums for this gold – Shanghai premiums topped out at $37 an ounce above the London fix before recently returning to par, in India it hit a highs of $170 above and remains at $50+ while traders in Vietnam regularly demand more than $200 on top of the global ruling price.

Evidence of the extent of these flows come from new export statistics from Swiss customs officials which show the European nation's gold exports rising 77% in 2013, according to Goldreporter.de.

According to Swiss trade statistics published this week, Switzerland exported 2,777 tonnes of gold worth 117.68 billion Francs ($132 billion) in 2013.

Despite the 28% decline in the price of gold over the course of 2013, the value of exports nevertheless increased by 48% with the average price per kilogram pegged at $47,459.

Swiss gold imports went up 36% to 3,080 tonnes and the country also imported 21 tonnes of gold and platinum coins of which 9.2 tonnes were re-exported.

Customs officials also reported silver exports of 2,411 tonnes worth $1.92 billion and silver imports worth $1.55 billion. Silver export rose 10% in dollar and 47% in volume terms.

Switzerland produces no gold itself. In 2012 and Alpine village turned down a $1.2 billion project which would've been the country's first and only gold mine.

Image by Ana Ulin