Retailers in the emirate of Abu Dhabi sold around 4,500 kilogrammes of the precious metal in the first quarter, said Tushar Patni, managing director of Ajanta Jewellery and a member of the Abu Dhabi Gold and Jewellery Group.
“With people trying to tighten their belts it’s not a good time for gold retailers,” Patni said. “In volume terms, the Q1 figures this year are around 20 per cent lower than the first quarter of 2008.”
Last week, Patni said small retailers in Abu Dhabi were struggling to survive as the combination of high prices and the economic downturn keeps tourists and consumers away.
Gold bullion prices have risen as investors switched money into gold, looking to defend value as other asset classes performed poorly during the slowdown.
Tax-free jewellery in the UAE’s gold souks and shopping malls is a major draw for many Gulf Arabs, Asian and Western visitors, but the recession has hit that source of income.
Sales to tourists account for about 60 per cent of retail gold sales in the seven-member federation of the United Arab Emirates. Abu Dhabi holds the capital of the UAE.
In terms of value, Abu Dhabi first quarter sales fell about 7 per cent on the year to Dh450 million ($122.5 million).
The rise in price has compensated for some of the fall in sales. An ounce of 22 carat gold was selling at Dh99, down from around Dh82 a year ago, he said.
The government of Abu Dhabi has plans to boost spending on marketing for gold retailers and will make changes to the format of the informal jewellery group to do this. The group currently represents some 110 retailers.
Events to be staged at the DWTC, comprising diverse sectors including construction, energy, technology, beauty, food, healthcare, environment and automotive, will mark the emirate’s post-pandemic economic recovery
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