Close to US$70 billion (Dh257.09bn) of gold was traded through Dubai last year as volumes of the precious metal imported and exported via the emirate increased, according to the Dubai Multi Commodities Centre (DMCC).
The official data on Dubai's gold trade for the past year has yet to be released by the customs department but Ahmed Bin Sulayem, the executive chairman of the DMCC, revealed the number yesterday in his keynote speech on the second day of this year's Precious Metals Conference.
"Dubai has risen as a major global gold and precious metals trading destination with over 20 per cent of the world's physical gold imported and exported through the emirate. The value of gold traded through Dubai in 2012 was $70bn compared to US$6bn in 2003," he said.
In 2002 Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai, predicted the emirate would one day capture a 50 per cent share of the global gold trade.
Since then hundreds of gold trading, refining and jewellery manufacturing companies have moved to the emirate to set up shop within the Jumeirah Lakes Towers free zone, which has a tower named after the precious metal.
Mr Bin Sulayem suggested that volumes of gold traded through Dubai last year had increased markedly compared to the year before when $56bn of gold was traded through the emirate. "You had record gold prices in 2011, higher than last year so of course volumes were higher in 2012," he said.
The price of gold rose above $1,900 a troy ounce in September 2011, and hovered around $1,600 throughout last year.
Traders agreed that volumes were up last year.
"The estimated size of Dubai gold trade of $70bn suggests higher tonnage last year," said Jeff Rhodes, the global head of precious metals at INTL-FCStone in Dubai.
Dubai has positioned itself as a global hub for the gold trade with the DMCC and its Gold and Commodities Exchange (DGCX) at the heart of operations.
The DGCX plans to debut a spot gold contract by the end of this year, which is expected to further increase gold traded through the emirate.
What is more, refining capacity is to increase markedly next year when the Kaloti Group plans to open a $60 million refinery with a capacity to forge as much as 1,400 tonnes of gold a year.
The factory will also produce 600 tonnes of silver and other precious metals a year.
Kaloti expects to triple its current refinery production to help the company to meet rising demand while its mint department is designed to produce a range of gold ingots and coins made of investment grade 999.9 purity gold, known as four-nine in the trade.
Gold is renowned as a safe haven investment during troubled economic times.
It has risen in value from $890 a troy ounce in 2008 when the current downturn began, to more than $1,500 an ounce today.