There are 10 active Dubai Good Delivery Gold Members, although at present with only three refineries based in the UAE, Al Etihad Gold Refinery DMCC, Emirates Gold DMCC and Sam Precious Metals FZ-LLC. Looking at silver, the current list features six refineries with three located in the UAE, these being the same three operations as mentioned above.

Considering there are around 10 active gold refineries in the UAE, the fact that the more operations are not UAEGD accredited may simply be a timing issue as the accreditation process runs its course, as well as the fact that the DGD code is voluntary, which is in keeping with the setup in some other locations. However, with the signing of the India-UAE CEPA, where the Indian duty on gold bullion is 1% lower at 14% for imports of up to 150t annually, this may encourage more UAE refineries to join the DMCC as CEPA allows only UAEGD bars to be delivered into the country. The same is true for the silver at 9.5% (1.25% lower), which is set to be zero-rated in 10 years’ time.

The attractiveness of CEPAs to the Dubai trade may encourage UAE-accredited refineries to bring in more gold for processing. However, as global refining capacity already exceeds combined world gold mine production and recycling, it will be interesting to see how this new dynamic plays out.

Other than the local refineries, the UAE (and particularly Dubai) hosts several local and international gold bullion dealers, many of which are based in the DMCC, in the traditional and newly constructed Gold Souks in Deira district. The Gold Souk, which traces its roots to the early 1900s, covered an area of just around 400 square meters, with only a handful of jewellers. During the 1940s, with the introduction of more liberal business and trade policies, the city started to attract Iranian and Indian investors. Another milestone was the discovery of oil in the region in the 1970s and the foundation of the UAE in 1971. As gold demand in the Gulf region has increased over the years, and especially in the wake of the momentum it gained from the 1990s onwards, more businesses from India arrived. Although today there are other areas in Dubai where jewellery fabrication and trading occur, the Gold Souk remains the most popular destination in the UAE for gold, which has over the years from its humble beginning, expanded to house 400 shops a decade ago, to now comprising almost double that figure.