DUBAI, United Arab Emirates (AP) — Dubai is sometimes called the “City of Gold” because of its stunning growth from a sleepy Gulf port to a world-famous business crossroads in the space of a single generation. Its nickname has a literal meaning for traders in the precious metal.
The city is building itself up as a center for the gold trade, between sources in Africa and consumers in the rising economies of China and India.
Dubai now has about a 29 percent market share of global gold trade with nearly 1,200 tons — worth about $41 billion — changing hands at the city’s gold markets, according to the gold industry website bullionstreet.com.
That’s up from around $6 billion worth traded in the emirate in 2003, said Malcolm Wall Morris, CEO of Dubai Multi Commodities Centre, set up by the emirate to oversee the trade. “There’s no doubt the geographical location of Dubai has played an important factor,” he said.
Dubai’s tax-free status has made it one of the cheapest places to buy gold in the world. The emirate has set up gold refineries and vaults and jewelry-making facilities, importing gold — including scrap from India — and melting it down to produce gold bars. At the Dubai Gold and Commodities Exchange, traders and speculators buy and sell the metal on the futures market.
Gold prices remained relatively steady in 2012, close to $1,700 an ounce. Some traders predict prices could once again rise toward the record high of nearly $1,900 an ounce, as central governments and investors look to gold as a safe bet in the unsteady world economy.
The city has also become a retail center with 600 shops selling gold — half of them crammed into the gold souq, drawing tourists, traders and local residents.
Lola Oyekola, from Lagos, Nigeria, came to Dubai especially to buy gold.
“Because I know I will get what I want, unique ones,” she said. “I can tell them what I want and they will make it for me.”
More Related Stories
- Developers evict historic women's shelter to build luxury hotel
- Kaitlyn Hunt refuses plea offer, will go to court over high school relationship
- DHS admits "impossible" to control 3D-printed guns
- Journalists file suit against Manning trial secrecy
- Russia: Syrian regime ready to talk peace
- Report: Nearly a quarter of all Americans struggle to afford food
- Ted Cruz against the world
- Louie Gohmert: Women should be forced to carry nonviable pregnancies to term
- 2 men arrested for endangering commercial aircraft
- Oversized load blamed for bridge collapse
- This is what Guy Fieri looks like as a balloon
- Iran hackers aiming at U.S. energy firms
- Lawyers release data in attempt to discredit Trayvon Martin
- Anonymous rallies behind Kaitlyn Hunt
- Bridge collapse: Part of "aging infrastructure"
- Mistrial in penalty phase of Arias case
- Amanda Bynes arrested after hurling bong from window
- Interstate 5 bridge collapses north of Seattle
- Mississippi could begin prosecuting women for miscarriages
- Teenage girl claims she was beaten up for looking like Taylor Swift
- UK Military: London attack victim was a "model soldier"
Featured Slide Shows
The week in 10 picsclose X
- 1 of 11
Credit: AP/LM Otero
Credit: AP/Matt Rourke
Credit: AP/Jenny Aicher
Credit: AP/Molly Riley
Credit: AP/J. Scott Applewhite
Credit: AP/Carolyn Kaster
Credit: AP/Las Vegas Review-Journal/Jeff Scheid
Credit: AP/NASA/Chris Hadfield
Credit: AP/Jacquelyn Martin
Credit: AP/The Duluth News-Tribune/Clint Austin
Recent Slide Shows
- 1 of 11