70 Years of Fachvereinigung Edelmetalle

Has It Changed In Size?

Today, Fachvereinigung has 35 members, ranging from producers and manufacturers to traders, banks and associations. Seventy years ago, 3,000 employees worked in its member companies, but there are now over 6,000. For many years, the Fachvereinigung offices were located in Düsseldorf, but in 2006, it relocated to Pforzheim, known as the ‘Goldstadt’ (gold city).

What Role Have Precious Metals Played In The Last 70 Years?

Increasingly, precious metals have become part of our everyday life. Our modern and technological society would not operate without precious metals: there would be no computers, no smart-phones, no GPS, no medical devices. In the course of the last 70 years, precious metals have played an ever-important role in the watch and jewellery industries as well as in investment products. Societies are evolving constantly, economically, socially and technologically. Fachvereinigung Edelmetalle has had to adjust to these ever-growing challenges as well as an ever-changing political landscape.

What Was It Like In Germany At The Time That Fachvereinigung Was Founded?

At the time, the Federal Republic of Germany did not exist, either as a German Federal Government never mind as part of a wider European project. At the time, all efforts were focused on rebuilding the manufacturing sectors in Germany and in Europe that had survived World War II. The growing precious metals industry encountered difficulties with the supply of raw materials, particularly because until 1954 precious metals had been allocated exclusively for technical, medical and scientific use.

What Did The Political Landscape Look Like Then?

The precious metals industry embraced the economic theories and thoughts of the first Minister of Economics in Germany, Ludwig Erhard, who published a book entitled Welfare for Everybody. It expressed the idea at that time that economic welfare should guarantee political stability in Europe. The foundation of the European Economic Community (EEC) in 1957 was a milestone towards increased prosperity and stability. Even then, the European countries had been important customers of precious metals products. The EEC was the beginning of an exceptional success story particularly in terms of delivering peace in Europe.

After having created the basis of a well- functioning economy – supplied with raw materials and benefiting from free trade – new challenges arose in the 1960s and 1970s. This was the result of new economic structures. The emphasis began to shift away from economic policies towards those which were more socially responsible.

After The War Resources Would Presumably Have Been Expensive And Scarce. How Did Fachvereinigung Cope, Particularly In Its Infancy?

Except for the supply problems after the end of World War II, raw materials had never been an issue: raw materials were considered to be available in unlimited supply. But this assumption was challenged in 1972 when the study, The Limits to Growth, commissioned by the Club of Rome, was published. The study argued that exponfential economic and population growth was limited by a finite supply of global resources.

How Did This Study And Subsequent Debate Impact The Precious Metals Industry In Germany?

Today, environmental policy and attitudes towards raw materials have one common goal: to protect the planet’s finite resources. To achieve this, the precious metals industry serves as a shining example. The industry had been implementing a circular economy long before others learned to understand the word ‘recycling’. Precious metals refineries all over the world are specialised to produce new products out of the recycling of scrap containing precious metals. Today, scrap accounts for around 50% of total worldwide supply. This is a real contribution to the environment.

You Have A Wide Cross-Section Of Members. How Does Fachvereinigung Juggle The Conflicting Requirements Of Them?

Though a wide range of companies from small to big are members of Fachvereinigung Edelmetalle, their requirements are more or less the same. So we don’t have considerable conflicting areas within our federation. And if a problem should come up, we always find a compromise that is acceptable to everybody.

What Impact, If Any, Will The Uk Leaving The European Union Have On The German Precious Metals Markets?

There might be an impact on taxes, tariffs and payment transactions. We are afraid of more bureaucracy regarding imports and exports, and rising costs. Maybe, we have to expect regulations in the field of handling dangerous substances that could be more complex than those we have today. Another question that arises is how UK companies themselves will be affected by Brexit, bearing in mind that trade regulations vis-à-vis EU might be similar to those of third countries.

Today, scrap accounts for around 50% of total worldwide supply.

Is NSFR A Major Issue For The German Precious Metals Industry?

The discussions about the Net Stable Funding Ratio (NSFR) are very important to the German precious metals industry. Together with LBMA, we have made great efforts to convince the national governments, the Commission and the European Parliament to make an exception for the precious metals industry from a ratio of 85% under the NSFR regime. We were proud of a compromise solution of 50%, but at the last minute, the policymakers preferred to stick to the original 85% proposal. Now, the European Banking Authority will be working on a study about the functioning of the precious metals markets within the next two years. Let us hope that the outcome will be the starting point of further discussions regarding an exception for our precious metals.

If We Could Now Talk A Little About You. You Recently Announced Your Retirement. Did You Spend All Of Your Career At Fachvereinigung?

I studied economics. Right from the beginning of my professional career, I have worked in federations. To begin with, I worked for three years at the German newspaper editors association and, then in 1984, I started to explore the world of the non-ferrous metals as advisor for economic policy in the German non-ferrous metals federation in Düsseldorf. At the time, the Managing Director of this association explained to me: “If you really want to join the non-ferrous metals and precious metals industry, there will be two options: you will leave this industry within three days, or you will stay there for the rest of your life!” I have now worked in this industry for more than 25 years, and it’s still a fascinating job. In 1994, I became Managing Director of Fachvereinigung Edelmetalle, which was a former member of the non-ferrous metals federation (Wirtschaftsvereinigung Metalle).

What Attracted You To The Precious Metals Market?

I learned from my activities in the non-ferrous metals industry that precious metals are very special metals with a fascinating history, interesting markets and products that are indispensable for our modern lifestyle. So, when the opportunity arose, I was very proud to become a part of this brilliant industry.

What Was The Highlight Of Your Career?

When you are working in an industry like ours, you can look back to many different highlights. I think the successful reorganisation of Fachvereinigung Edelmetalle with the relocation to Pforzheim in 2006 is a particular highlight and still has an impact today. Another highlight for sure was the founding of the European Precious Metals Federation in Brussels in 2009. Fachvereinigung Edelmetalle was one of the founding members, and I had the honour to run this federation as President at that time.

What Are Your Plans Now That You Have Retired?

In the first place, to spend more time with my family, who very often knew my face only from photographs or only heard my voice in telephone calls. But when you have been working in an industry like precious metals for 25 years, you never stop being interested in the industry and in the people working for it. So, I will continue to read the Alchemist which for me is one of the most important information sources about the wide range of precious metals topics. Furthermore, I hope to devote much more time to my favourite hobbies: English literature and playing tennis!