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Gold loses luster

16 Sep 2020

Muscat’s most popular shopping street Souq Ruwi (Ruwi Highstreet), once bustling with prospective gold shoppers, now faces the ramifications of the COVID-19 pandemic. 

Several gold jewellery showrooms, local as well as international brands, have shut shop.

Starting from Makka Centre to the old Ruwi Police Station, the iconic shopping hub is lined with gold jewellery shops on either side. But the drop in global oil prices, followed by the ongoing COVID-19 pandemic, has left the gold business in tatters. 

Some of the renowned international and bigger local brands had three even four showrooms on Ruwi Highstreet. Following the downturn, the international brands have scaled down operations cutting down the number of their branches.

Among others, three international brands have shuttered outlets on the highstreet. All three had three outlets; two closed two each while the third shut down one of its three showrooms. There are others that have closed their only showroom on the once most promising gold jewellery business street.

“Our company decided to close our other branches and kept only this newly opened showroom due to drop in business,” said a shop attendant who spoke on the condition of anonymity. 

“We have noticed a rise in number of shoppers in our mall showrooms, which means people are still afraid of visiting Ruwi area due to the fear of the coronavirus.”

He noted that the current high gold rate is another factor for the slowdown in jewellery business.

Rajesh Dey of National Jewellers too blamed the soaring price of gold as a factor responsible for the state of affairs on Ruwi Highstreet. 

“Business is really bad at the moment. Unless gold rate comes down and the current pandemic is under control, it makes no sense even to open the shops.”

In his estimate, gold jewellery business is down by almost 75 per cent. “Going forward, the biggest challenge is the economic slowdown caused by the pandemic as well as the dwindling expat population, which forms the bulk of customers in the Ruwi Souq. So many expats have lost their jobs while others are worried of losing their jobs and unsure about the future.”

A salesman at an outlet of a prominent jewellery chain nearby too put the current lull in market down to the rise in gold price, besides a general slowdown in retail business. 

“Gold rate used to be around RO18 before January. Now it hovers above RO24. This spike has nothing to do with retail gold jewellery business but due to high investment in gold on a global level.” 

He explained that due to a crash in the international market as a result of the pandemic, investors are seeing gold as a good investment option sending the price of gold soaring. 

“Besides high gold price and the economic slowdown caused by the COVID-19 pandemic, other factors like closure of public transport also have a role to play in fewer people visiting Ruwi Souq,” said Abdul Wahid of Abdul Hamid bin Adam Trading, which has four gold and diamond jewellery showrooms on the highstreet.

He claimed his business’ parent company Adam Group is more than 40 years old, and from experience he said, “We are confident that our loyal customers will return and business will pick up.

(Text and photos Syed Fasiuddin)

 

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