SHARJAH
Luxury watchmakers and jewellery traders are optimistic about the year despite weak consumer confidence and fall in tourist inflow.
Gianpaolo Bruno, Trade Commissioner to the UAE, Oman and Pakistan at the Italian Trade Agency, said demand is weak for mid-range jewellery segment but strong for luxury and hand-crafted jewellery items.
“In the last few years, we witnessed a bit of contraction in sales due to weak oil prices and fall in tourist inflows from Russia and China. We still keep investing in the UAE as the country is still the best place for luxury business in the Middle East,” he told Gulf News on the sidelines of the 42nd edition of the Middle East Watch and Jewellery Show which opened doors on Tuesday at the Expo Centre Sharjah.
The five-day business-to-consumer show was inaugurated by Shaikh Khalid Bin Abdullah Bin Sultan Al Qasimi, Chairman of Seaports and Customs Department, Sharjah.
More than 500 exhibitors from 20 countries around the world are showcasing some of the most prestigious watches and jewellery brands.
Abdullah Bin Sultan Al Owais, Chairman of the Sharjah Chamber of Commerce and Industry, said that Arabs love gold jewellery.
Even though gold prices are going up and demand is coming down, he said companies are changing types and designs to manage costs and boost sales.
The growth in exhibitors at the event is a good indicator and shows there is still demand in the market for luxury watches and jewellery.
“The UAE and many countries around the region enjoy a growing market for luxury products, driven by the demand from locals, residents, tourists, and the youth who are knowledgeable about luxury and niche brands,” he said.
The list of participating countries includes Italy, the UK, Brazil, the US, Lithuania, Turkey, India, China, Japan, Malaysia, Pakistan, Hong Kong, Singapore, Thailand, Lebanon, Jordan, Saudi Arabia, Yemen and Bahrain, in addition to the most prominent companies from the UAE.
India has the lion’s share of this year’s participation, with 70 exhibitors located at its pavilion, followed by Hong Kong (46 exhibitors), Italy (30 exhibitors), Lebanon (28 exhibitors), Singapore and Malaysia (16 exhibitors each), Turkey (15 exhibitors), Thailand (9 exhibitors) and China (5 exhibitors).
According to research firm Euromonitor International, Emiratis spent approximately $7 billion (Dh25.71 billion) in 2016, recording a 14.6 per cent increase compared to 2015.
Italian Trade Agency’s Bruno said that the demand is still strong for ‘Made in Italy’ products despite stiff competition and new players entering the arena. “We are expecting a recovery in demand this year, especially in the second half. We have already experienced a five per cent import duty on gold and diamond jewellery in Dubai this year and with the introduction of a value-added tax (VAT) regime from next year, we will definitely face uneasiness from our producers,” he said. “We believe that these taxes may impact our demand but Italian designs have a competitive advantage.”
Italy imported gold worth 1 billion euros in 2016 compared to 1.2 billion euros in 2015.
“This year we hope to increase our revenues to more than 1 billion euros (Dh3.91 billion),” he added.
Hasan Awwad, assistant sales manager at Jovial Watches, said that demand for luxury watches has fallen but the demand is still strong for medium-priced [less than Dh2,000] in the UAE.
Awwad cited lack of tourists and the high cost of living in the emirate as reasons.
He claimed that this is the best show in the UAE and that his company has been recording good sales. “This year also we expect our sales to improve over last year,” he said.
