Gold mining in China has made the country the world's largest gold producer. For the year 2007, gold output rose 12% from 2006 to 276 tonnes to become the world's largest for the first time -- overtaking South Africa. This tremendous increase has been due to rapid capital expansion and low costs of labor.

The Chinese government began reforms in the mid-1990s encouraging small operators to consolidate and allow foreign companies to form joint ventures so that Chinese companies could learn modern management practices, financial controls, and industrial, environmental and safety standards. Gold output in China has risen by 70% for the past decade. In recent years, China's gold mining industry has received increased foreign and domestic investment, and project numbers have increased as more discoveries have been found.

Chinese gold producers have gained enormously from the record high gold prices as investors worldwide are seeking stability due to the decline in the value of the dollar.