Bahrainis now fuel investment in gold

TDT | Manama

The Daily Tribune – www.newsofbahrain.com

Bahrainis are now finding gold an attractive investment opportunity, thanks to the pandemic season which made hospitality, real estate and other businesses less attractive.

Industry sources said Bahrainis’ gold-buying spree has led to increased sales last year.

“Generally, it is the expatriates who go for gold, both in terms of investment and ornaments.

But last year saw a great difference. We could see a lot of Bahrainis entering the gold market,” the source said.

The Daily Tribune spoke to many jewellers, who said that last year’s sales were one of the highest and “it did come as a surprise to them”.

“To be frank, we didn’t expect sales to grow last year as we were in the midst of the pandemic season.

But surprisingly, more and more Bahrainis began buying gold, making the year one of the best for the jewellers in the Kingdom,” a senior manager with a leading jewellery company, said.

He said Bahrainis mostly preferred 21-carat gold compared to the expatriates’ choice of 22-carat gold.

“For the first time, I could see a large number of Bahrainis buying silver as well,” he added.

Shaji C K, Retail Sales Manager with Bhaskar Devji Jewellers, said last year’s sales were impressive.

“We must acknowledge the fact that these high sales have been recorded despite remaining closed for one-and-a-half months owing to COVID-19 lockdowns,” Shaji said.

“Two factors led to resilience last year.

One was the increasing interest shown by Bahrainis, Saudi nationals and other Arab nationals to buy gold, and the second was pre-VAT sales, which began in October last year and peaked in December.”

He said his company would introduce new product ranges and new designs to match the requirements of the increasing number of customers.

A businessman based in the Kingdom, who has been a solid investor in gold for the past few years, said Bahraini and Arab nationals are now following the latest norm of investment, which is diversification.

“Investments can be categorised into four – low risk, high risk, moderate risk and zero risk. Gold comes under the low-risk category as prices have remained stable in the past few years and it is a highly liquid asset.”

He said the value of gold is increasing day by day not because of the fondness for ornaments but due to its increasing significance in the manufacturing sector.

“Gold is of numerous users in the manufacturing industry.

It is now used for manufacturing computer chips to watches,” the business explained.

The Daily Tribune reported that the Domestic and Foreign Trade Department within the Industries, Commerce and Tourism Ministry hallmarked over 9.9 tonnes of gold jewellery last year, which is one of the highest on record.

Shaikh Hamad bin Salman Al Khalifa, Ministry Undersecretary said the Kingdom last year witnessed a sharp increase in the quantity of precious jewellery received for analysing, as well as hallmarking at the testing and metrology services.

He pointed out that the quantity of gold hallmarked last year was an increase of 60 per cent when compared to 2020.

Shaikh Hamad said the ministry fulfilled more than 38,000 service requests during last year while the total number of jewellery tested exceeded a whopping one million and 350 thousand pieces.

In 2021, the ministry also carried out 3,400 inspection visits to jewellery stores to ensure compliance with the requirements of pearls and precious metals in the Kingdom, which is a 38pc increase from a year ago.