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Sri Lanka’s gem industries sparkle By Richard Brighouse Resources Correspondent, FIRST

s the world’s economies pick up after the Labour including those on Child Labour. It has strict The problems of the 2008 financial crash, Sri prohibitions on employing any person under the age Lanka’s gem and jewellery sectors are well- of 16. government placed to ride the growth wave, offering The NGJA is the only state-run agency of its kind opportunitiesA for foreign investors as well. in the world, that regulates, promotes and markets Sri and the NGJA Sri Lankans are justifiably proud of their country’s Lanka’s gemstone and jewellery industries. Since 1993 rich gemstone heritage (an ancient name for the organisation has also laid down the framework has set a goal is Ratnadvipa which means “Island of Gems”). The for “green” mining practices and a responsible and island continues to be one of the most important transparent mine-to-market supply chain. of doubling sources of fine sapphires in the world (the Ceylon Blue The NGJA estimates that Sri Lanka supplies less Sapphire), and arguably no other country has produced than 2 per cent of the global trade in precious and gemstone sapphires to match the size, quantity and quality for as semi-precious gems. The government and the NGJA long a time as Sri Lanka. has set a goal of doubling gemstone and jewellery and jewellery In the thirteenth century Marco Polo visited Sri exports to US$1bn by 2016, by promoting value- Lanka on his homeward journey from China to Venice added manufacturing and developing opportunities, exports to and his chronicle mentions the gems of the island, particularly in China, and Russia. writing that the island had the best sapphires, topazes, “Right now, our gemstone and jewellery US$1bn by amethysts, and other gems in the world. He also manufacturers are exporting to more than 70 records that he found the Moors, the descendants of countries,” said Ajith Perera, deputy director- 2016 the Arabs, in undisputed possession of the gem trade of NGJA. “In 2011 the sector generated US$525m in of Sri Lanka. It is also believed that Sinbad’s Valley of exports. We hope to reach our US$1bn target through Gems in the Arabian Nights is probably the Ratnapura a three-pronged strategy. We will provide a reliable gem fields (Ratnapura remains the centre of the gem and steady supply of goods; tap into new markets; and sector in the country). encourage and support capacity-building activities Sri Lanka is now geared to establishing a world-class through skills training and development.” gem and jewellery hub. The entire industry employs Sri Lanka’s coloured gemstone industry received approximately 600,000 people, including miners, a welcome boost in 2011 from the royal wedding cutters and polishers, dealers, jewellery designers, of William and Kate. The Ceylon blue sapphire manufacturers and craftsmen, marketing and sales people. engagement ring William gave to Kate is a Windsor The Sri Lankan government and the National family heirloom previously worn by Princess Diana. Gem & Jewellery Authority (NGJA) list the country’s Gemstone dealers in Sri Lanka reported significantly competitive advantages in the gem sector as follows: increased demand for blue sapphires since the wedding. • Long history of gem cutting – artisan culture which “The growth in momentum in the sector augurs well still sustains itself for related industries,” said NGJA chairman and chief • An educated and trainable workforce executive Rohan Daluwatte. • The availability of a wide variety of precious and Under its expanded promotional programme the semi-precious gem stones NGJA will organise a “Sri Lanka Pavilion” at major gem • A business-friendly government, with the minimum exhibitions in Beijing, Shanghai, Hong Kong, Singapore of formalities providing a wide array of tax incentives and Istanbul. “Our next target markets will be Ukraine, • Duty free imports of raw materials Kazakhstan and Poland,” said Perera. “Solid demand • Sri Lanka is an active member of International from China, India, the Middle East and Eastern Europe Coloured Gemstone Association (ICA) is off-setting slower US and European sales.” • ATA Carnet system is in operation in Sri Lanka Deep mining is principally at planning stage. and the issuing authority is International Chamber of Nearly all the country’s mining is artisanal mining in Commerce in Sri Lanka alluvial deposits, and mining remains an area where • The country is a signatory to all United Nations and technological development will inevitable open up International Labour Organisation conventions on greater seams of thus far undeveloped or indeed 51

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Some of the undiscovered gems. About 90 per cent of gem mining has recently included watch brands such as Tag Heuer is carried out in alluvial deposits using traditional and Visconti among its customers. country’s top methods, in open cast shallow pits or deeper shaft type In recent times, Sri Lanka has been quietly pits and tunnels, or by manually dredging the river modernising its gem mining methods, lapidary skills gemstone beds. A gradual rise in the use of light mechanised and marketing. Nowadays, the country is emphasising mining methods can also be seen in recent times. Sri education in all areas of the gem industry to enhance the manufacturers Lanka already produces sapphires, rubies, star rubies, profitability of the business. There are many public and alexandrites, cat’s eyes garnets, zircons, tourmalines private educational institutions that have courses ranging are supplying and spinels. The primary manufacturing activities from courses in cutting to a scientific PhD programme are gem cutting (lapidary) and jewellery manufacture. in gemology. For those interested in studying gemology, precision-cut The lapidary sub-sector consists of the diamond there are several places where courses are offered that manufacturing industry and cutting and polishing will lead to the Gemmological Association of Great sapphires that of coloured gemstones. The sub-sector for jewellery Britain’s diploma in gemology (FGA). manufacture consists mostly of traditional artisanal Sri Lanka only exports cut and polished gems. Some are 0.3mm production units but modern mass manufacture is also of the country’s top gemstone manufacturers are on the rise. It is estimated that there are around 3,000 supplying precision-cut sapphires that are 0.3mm in in diameter manufacturing units around the country. diameter to jewellers and Swiss watchmakers. “Rolex, The retail sector in Sri Lanka is vibrant, however, Montblanc, Tiffany and Cartier are among the high- to jewellers with a number of large family-owned firms operating end customers of Sri Lankan gemstone manufacturers,” in the sector. For example, Sifani was founded in 1970, Perera says. “They require high-precision gemstone and Swiss and is still a family-owned firm, with more than 30 manufacturing and we are capable of delivering this shops in Sri Lanka, Maldives, Seychelles and London. type of goods. We also help local jewellers develop new watchmakers As is common in the country, commercial enterprise designs for export.” is combined with philanthropy. The directors The NGJA is also the organiser of a number of established the A.M.M. Sahabdeen Trust Foundation expos in the held in the country annually, including the in 1979 to provide educational opportunities in Sri International Gem, Mineral & Jewellery Trade Show Lanka. Another example is Jewellery Stores, held in December in Colombo, and “Facets” (the Sri established in 1922 and now the country’s most Lankan International Gem & Jewellery Show), now in respected and revered gems and jewellery brand. CJS its 23rd year held in August/September. has been a family-owned firm since its inception and As a signatory of the Kimberley Process Certification Scheme, Sri Lanka is also a competitive diamond manufacturing hub, he added. “The country has 16 diamond manufacturers. Not many people are aware of the fact that Sri Lanka is the only country in the world that produces tapered baguette diamonds.” Sri Lanka has earned a reputation for its high-quality cutting and polishing diamonds. Sri Lanka’s speciality is small diamonds of exceptionally high quality, which are imported sawn or cleaved rough. In addition to the traditional brilliant cut, many cutting companies handle other specialised shapes and cuts, particularly tapers, baguettes and princes, etc. While most of the rough diamonds imported for processing are sawn or cleaved in Belgium, a few companies purchase rough diamonds in the open market, selling the cut and polished product through The Ceylon blue overseas affiliates. sapphire engagement In early 2012 the Sri Lankan government floated the ring, given by William rupee, resulting in a sharp depreciation, and took steps to Kate and previously to curb imports. Growth, however, stands at a healthy worn by Princess 6 per cent or thereabouts in 2013. With the civil war Diana, boosted Sri sliding into the pages of history and an economic Lanka’s reputation as strategy designed to attract inward investment through a leading supplier of tax incentives, the prospects for the gem and jewellery 52 quality gemstones sectors in Sri Lanka have a definite sparkle. F

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