(MENAFN - Arab News) An official in the Makkah Chamber of Commerce revealed to Al Eqtisadiah newspaper that gold sales have dropped by 70 percent, as traders and investors of the yellow metal moved away from the main area of the Grand Mosque, and failed to take advantage of the purchasing power of Umrah pilgrims.
The official added that most of the pilgrims couldn't find their way to the gold markets because they were located far from the area surrounding the Grand Mosque.
"There should be diversification and comprehensiveness in the licensed shops within the central location that surrounds the area of the Grand Mosque," demanded Ziyad Farsi, deputy chairman of the Makkah Chamber, adding that this has led to a drop in the sales of many shops and business activities and reduced income as a result.
"Personally, I think that part of the problem is the high rental prices of land around the premises' of the Grand Mosque, with prices reaching more than SR 2 million," noted Farsi.
Moreover, due to the tight supply of alternative stores and the poor distribution and licensing of shops, a problem has ensued in which more than one store sells the same or similar products within close vicinity of one another. "Visitors and pilgrims need a wide variety of gifts and daily necessities, other than food and beverages," noted Farsi. He stressed that this issue needs addressing through seminars and workshop from a number of concerned parties, including the Makkah Chamber of Commerce, the Ministry of Commerce and the Makkah Secretariat, to organize markets in a manner that ensures diversification.
"Two years ago, we tried to organize a forum to discuss this problem and to find adequate solutions," he said. As for the gold and jewelry markets, he added that the chamber held a forum dedicated toward discussing marketing ideas especially in view of the rising international prices of pure gold, which led to a drop of 70 percent in sales, compared to previous years. This trend occurs despite the fact that 95 percent of the gold in the market is locally manufactured, which should encourage buyers to purchase, as the cost of local workmanship does not exceed SR 15 for one gram, compared to the higher prices of imported jewelry.
This problem was further augmented with the departure of long standing shops in the area to faraway places that visitors and pilgrims do not know how to get to, even though many of them long to buy presents and jewelry gifts before going back to their countries.