RIYADH(BullionStreet): More than 500 gold shops has been closed in Saudi Arabia in the last three months due to the losses resulting from the rise in the international prices of the yellow metal.

According to Saudi's Chamber of Commerce and Industry, most of these shops are in country's Eastern Province .

The Association also said "Another 150 workshops run by foreigners pulled out because of their failure to abide by the licensing and trade regulations".

It said gold sales have dropped by 40% to 50% in the kingdom, with sales seen falling further this year,
Some 30 gold shops in Makkah alone closed down due to the decrease in gold sales and the increase in gold prices. Sales during the Umrah and Haj seasons failed to make up for the losses.

Observers said Saudi Jewellery owners had been complaining about low demand for gold and difficulties they face are looking for ways to boost the market. The traders also object to the inequality between Saudi traders and foreign investors in the gold market.

Meanwhile, Saudi Arabia's Ministry of Trade and Industry has begun monitoring gold sales outlets across the Kingdom after complaints from customers of variances in weighing in sales and purchases.