Dubai: The UAE is best placed to serve as the global hub for gold trade as a new economic corridor opens up between members of the BRICS grouping.
This would make the UAE an ‘alternative’ to traditional gold trade centres, according to a new report by the DMCC.
The UAE is already the second biggest gold hub in the world, having gone past the UK in 2023. Switzerland remains at the top of this particular ranking.
The UAE formally joined the BRICS bloc earlier this year. The group features Brazil, Russia, India, China and South Africa.
“We have witnessed historic shifts in the precious metals market, driven by Western sanctions that have forced record buying of gold by central banks and a rethink by many countries when it comes to their reliance on the US dollar,” said Ahmed Bin Sulayem, Executive Chairman and CEO of DMCC.
“We are seeing a new gold corridor form across Asia, with Dubai at its centre – exemplified by the UAE’s rise to become the world’s second-largest gold trading hub last year.”
A reset in global gold trades
The UAE’s gold trade is valued at over $129 billion. The impression in trading circles is that the BRICS grouping will recast established norms in trade ties and how the movement of goods will be dictated.
With the presence of China and India – the biggest and second biggest consumers of gold – in BRICS, there will be changes to how the metal is traded and moved around in the future.
Apart from BRICS, the UAE also has a CEPA deal with India, which too has meant a sizeable increase in offtake of bullion from here at a 5% import duty to India. India’s import duty for the metal from other markets is 6% now, after it was cut from 15% earlier this year.
