JEDDAH — Illegal cover-up (tasattur) business in gold and jewelry sector has reached 50 to 80 percent in the central, western and eastern regions of the Kingdom, said Saudi gold traders and officials. They also believe the present foreign investment law would drive them away from business.
Speaking to Al-Madina daily, Saudi gold traders complained that some Arab expatriates have entered the market by obtaining Saudi citizenship, GCC passports and foreign investment license.
Abdullatif Al-Namir, a gold and jewelry trader, estimated tasattur gold business in the Eastern Province at 50 percent and in western and central provinces at 80 percent. “This can be discovered easily as those who work in these shops do not know anything about gold and jewelry,” he added.
Abdul Ghani Al-Muhanna, chairman of the Precious Metals and Gems Committee at Asharqia Chamber, agreed with Al-Namir that tasattur business has engulfed the gold and jewelry sector.
“As a result of the dominance of foreigners, original traders have lost their name and fame as the expats do everything — legal or illegal — to woo customers,” he said, adding that many customers have complained about cheating by them.
Al-Muhanna said expatriates from a particular Arab country were trying to dominate the market, making use of benefits offered by the government to foreign investors and GCC citizens.
“These Arab citizens buy jewelry shops from Saudis in the Eastern Province. They also dominate the market in the Western Region,” he said while urging the government to support Saudi traders and jewelers to safeguard the profession.
Abdul Mohsen Al-Namir, a member of the National Committee for Precious Metals and Gems at the Council of Saudi Chambers, said it was difficult to identify tasattur in gold and jewelry sector as the expats running the business are relatives of Saudi sponsors.
“Traders from a particular Arab country are also dominating the market in the Western Region,” Al-Namir said, adding that this situation has forced many Saudi jewelers leaving the market to look for government jobs or other professions.
He said the foreign investment law has contributed to the expansion of tasattur in the sector. “Foreign investors get license by just paying SR500,000, which is equivalent to 3 kg of gold. This license can be used to open a gold factory or a jewelry shop,” he explained.
Al-Namir voiced Saudi fears about the government’s intention to open all economic sectors to foreign investment by 100 percent, adding that it would enable foreign traders to occupy the remaining part of the gold and jewelry market in the Kingdom.
Turki Al-Tuaimi, spokesman of the Commerce and Industry Ministry, emphasized his ministry’s efforts to track down tasattur business across the country.
“We have inspected more than 1,000 gold and jewelry shops and asked owners of 73 shops to visit the ministry to show their credentials to prove they are not involved in tasattur,” he said, adding that confirmed tasattur cases would be transferred to the Bureau of Investigation and Public Prosecution. The Court of Grievances will then issue its verdict on them.
Al-Tuaimi said his ministry has urged the public to inform about tasattur business in various sectors. “Agencies that issue licenses should also make sure they are not utilized for illegal business,” he said.
