A Region of Growing Importance
The Middle East, historically a significant consumer of gold, has witnessed a surge in its refining activities. While the region may not boast extensive gold production, similar to Europe, it stands out as a major hub for both bullion demand and jewellery consumption. This combination has propelled the Middle East to become a prominent player in the global gold refining landscape.
Key Figures and Accreditations
Before delving into the specific countries, it's essential to reiterate some key figures and accreditations.
- LBMA Good Delivery Refineries: 65 gold and 80 silver refineries
- Responsible Jewellery Council Chain of Custody Accredited: 79 Members
- Global Total Refining Figures: Approximately 1240 tonnes annually, with an average of 1150 tonnes over the past five years
Türkiye: A Gold Powerhouse
Türkiye, the largest jewellery producer, consumer, and gold investment country in the Middle East, has a rich history in gold consumption and fabrication. Established in 1467 by Fatih the Conqueror, its State Mint is one of the oldest in the world. The country boasts around a dozen refineries, including the state-of-the-art Aleks Metal Refinery in Istanbul. Türkiye's two LBMA-accredited refineries primarily serve the domestic market.
Key Figures for Türkiye (2023):
- Jewellery consumption: 42 tonnes
- Jewellery production: 155 tonnes
- Bullion investment: 150 tonnes
- Recycling volumes: 51 tonnes
Türkiye's strategic location, developed precious metals industry, and lower labour costs compared to Europe position it as a potential global refining hub.
The UAE: A Regional Hub
The United Arab Emirates (UAE) is considered the hub of the precious metals trade in the Middle East and a significant supplier of gold to India and Türkiye. While it doesn't have LBMA-accredited refineries, the UAE's DGD (Dubai Good Delivery) standard is gaining international recognition. With three DGD refineries, the UAE plays a crucial role in the region's gold supply chain.
Key Figures for the UAE:
- Jewellery consumption: 40 tonnes
- Jewellery production: 35 tonnes
Saudi Arabia: A Growing Market
Saudi Arabia, the largest nation in the Gulf Cooperation Council (GCC), has been increasingly opening up to the global market. Its bullion investment figures have steadily risen over the past four years, reaching 14 tonnes in 2023. While it ranks behind Türkiye and the UAE in jewellery consumption, Saudi Arabia's demand for gold is steadily growing, reaching 38 tonnes in 2023.
Egypt: A Rising Star
Egypt, with a population of 111 million, is an important consumer and manufacturing country in the Middle East. In recent years, it has emerged as a significant player in the gold investment sector, with figures increasing from 2.5 tonnes in 2021 to 30 tonnes in 2023. However, the reduction in taxes on bullion products has shifted consumer preferences from jewellery to investment gold, impacting the country's jewellery market.
Conclusion
The Middle East has witnessed a remarkable growth in its gold refining industry, driven by its increasing demand for both bullion and jewellery. Countries like Türkiye, the UAE, Saudi Arabia, and Egypt are playing pivotal roles in shaping the region's gold market. As the Middle East continues to expand its economic ties and infrastructure, its influence in the global gold refining landscape is expected to further solidify.
