Dubai Shopping Festival demand recovers
Old Gold Souq, Dubai
DUBAI, February 23, 2011 – Jewellery demand and tourist footfall picked up at the Dubai Shopping Festival this year after a subdued couple of years, local jewellers said.
Demand for gold jewellery had been weak over the last two years at the Dubai Shopping Festival due to the economic crisis, Dubai’s debt problems and the volatile and high price of gold.
But jewellers said the mood has now brightened and visitor numbers to Dubai were rising as the global economic outlook improved.
“Business has been good since November,” said Hitesh Pathak at Al Marari Jewellers in the Old Gold Souq in downtown Deira in Dubai.
“During the Shopping Festival we saw lots of customers,” Pathak added as the festival, which ran from January 20 to February 20, drew to a close.
Retailers said growing numbers of tourists from countries such as Russia and China were shopping for diamond jewellery.
“The Russians have good buying power,” Pathak said.
Dubai jewellers also said visitor numbers from India were rising.
They were shopping mainly for 22- or 24-karat gold jewellery.
Middle- and upper-income Indians are increasingly buying diamond jewellery for weddings and parties, jewellers said.
Old Gold Souq, Dubai
Recently some Gulf Arabs, including Saudis, had chosen to visit Dubai instead of Egypt or Bahrain, because of the political upheaval in those countries.
“There’s definitely a recovery at the Shopping Festival this year,” said Rajesh, a sales assistant at Shyam Jewellers, which stocks gold and diamond jewellery in the Old Gold Souq.
Organised by Dubai’s Department of Economic Development, the one month long Dubai Shopping Festival is launched to promote the retail sector in the so-called City of Gold by offering discounts and promotions.
According to the World Gold Council’s latest issue of Gold Demand Trends, global gold demand in 2010 reached a 10-year high in tonnage and an all-time high in value.
Gold demand for the year reached a 10- year high with annual demand of 3,812.2 tonnes worth approximately US$150 billion. On 9 November 2010, this demand led to a new record gold price of US$1,421.00 per ounce on the London PM fix.
Many of the tourists who visit Dubai during the Shopping Festival, are looking to save on the prices they would pay at home, because in Dubai there is zero tax on jewellery purchases.
For international tourists such as the Russians who spend a lot of money on jewellery, the tax savings in Dubai can effectively pay for the entire trip as the cost of buying the same brands back home would be much higher.
Top Italian brands such as Bulgari are well-established in Moscow, and Dubai jewellers say that Italian designs are very popular with Russian jewellery buyers.
Many Russians visiting the Old Gold Souq are shopping for “Made in Italy” chains.
“The Italian chains are manufactured and finished very well,” one jeweller in the souq said.
Across town, at The Dubai Mall, one of the biggest shopping centres in the world, located beside the Burj Khalifa tower, the tallest building in the world, footfall of tourist s visiting branded stores such as Cartier, Bulgari and Graff, as well as the Gold Souq, appeared brisker than a year ago.
“We’ve seen plenty of visits by tourists from Germany and Russia,” said one jeweller at Marhaba Jewellery.
At the Old Gold Souq, tourists were pestered by Indians trying to sell them copies of branded watches such as Rolexes, IWC and Vacheron Constantin.