Gold News

Middle East Gold Rush

Gold Investment looks "dependable" compared with Middle East real estate and stocks...

AGAINST A BACKDROP of fast-falling property prices, increasing unemployment and a sharp dip in equity trading, there is a glittering line of hope as far as Gold Investment is concerned in the Middle East nations, reports Commodity Online from Mumbai, India.

Gold investments across the Gulf countries are set for a sharp rise this year according to the trade-marketing group World Gold Council (WGC). Several Middle East nations including Dubai – the "City of Gold" – are going to be action centers for Gold Investing in 2009 and beyond.

"We feel Middle East nations are going to witness lots of investments in the various gold sectors," says Lama Al Saheb, head of marketing for the WGC in the Middle East.

"Several global companies including Gold Mining processing and production companies are looking at the Middle East for major investments."

The WGC predicts that Gold Investment will see an upswing this year, despite the global recessionary trend. Already in 2009, investment into the gold sector have started pouring into Middle East countries.

Last week, Global Force Capital and Elettronica SPA from Italy announced a joint venture to build a plant in Abu Dhabi for refining and fabricating Gold Bars and grains of other precious metals. It will be the first gold and silver refinery in Abu Dhabi, and it's set to be the largest dual refinery in the region.

For direct end-user Gold Investment in the metal itself, according to a WGC report, inflows across the Middle East jumped 38% in 2008 compared with the end of 2007. Saudi Arabia saw a massive 300% in Gold Investing demand, with Egypt up 67% and other Gulf countries registering a 2% increase.

In contrast, and while UAE gold jewelry sales increased by 17% in 2008, total ornamental gold demand across the Middle East was up just 1% in the fourth quarter of 2008 compared with 2007.

Weakness in the consumer jewelry sector largely offset strong growth of 139% in net retail Gold Investment.

WGC local marketing head Saheb says a key reason for the spurt in Gold Investing in the Middle East is the collapse of stock markets and the global economic meltdown.

"Investors and traders are nervous about the idea of investing in areas like real estate," he adds. "Many people see gold as the best and dependable investment."

Commodity Online is a leading online, print and content provider of news, information and research reports on the commodities sector. With offices in Mumbai, New Delhi, Ahmedabad, Cochin, Bangalore and Dubai, it also powers content in the SME sector, as well as the insurance and banking industries.

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