The Finance Ministry will push Thailand to be a gold trading hub in Asia, with the hope of attracting over 1 trillion baht a year in foreign investment, according to Jitti Tangsitpakdi, president of the Gold Traders Association (GTA).

The GTA had studied becoming a hub 10 years ago, but previous governments never supported the initiative.

"We're pleased that the Democrat-led government is interested in this project, so we will study the idea again," said Mr Jitti.

Upgrading the local gold trading market to be a trading centre for Asia will require a lot of assistance and funding from the government.

The previous GTA study found that Hong Kong and Singapore have outdated trading systems with no platforms prepared for being the hub of Asia.

"There are opportunities for Thailand if we can set up a new gold trading system," he said.

If Thailand became the gold trading hub in Asia, this would attract foreign investments of more than 1 trillion baht per year, said Mr Jitti.

The major obstacle remains political instability, as frequent government changes make foreign investors less confident about investing in Thailand.

Mr Jitti, also chairman of G.T. Wealth Management, a new trading broker for gold futures on the Thailand Futures Exchange (TFEX), said the company aimed to have a 3% market share in its first year. It hopes to grow more than 50% in trading volume over three years.

He said the company expects to have 500 trading accounts by the year-end and 1,000 accounts next year. The company will also appoint 15 selling agents for gold futures trading next year.

Mr Jitti said he did not agree with TFEX on launching a new gold futures contract size of 10 baht weight, smaller than the current 50 baht weight.

"I prefer to see TFEX increase the contract size to 100 baht weight as this can prevent retail investors from speculation, and prices will be less volatile. However, the bigger size will limit only big players who have knowledge of the gold market," he said.

He also argues that TFEX should not alter its trading fees. "We should wait a while to see market responses before revising the fee," he said.