Connect with us

RJ Market Watch

‘Sri Lankan jewellery sector is expected to grow at a steady pace in the next three years’



Andy Vijayakumar, the president of the Sri Lanka Jeweller’s Association, talks about the steps taken by his organisation with the government’s support, to empower the jewellery sector in the country

How has the jewellery industry faired in the recent past in Sri Lanka?

Similar to other retail industries, the jewellery industry has been impacted by Covid -19. As a result of multiple lockdowns imposed in Sri Lanka, there has been a reduction in footfall which has severely reduced the market’s performance. Pre-covid, the Sri Lankan jewellery industry was expected to grow by 6%over the next decade, however, due to the current setback it will take 2 to 3 years to reach pre-covid market performance.

What kind of challenges have jewellers faced where the government has provided relief?

With an increase in customs duty imposed on gold materials by the previous government, there was an adverse impact on the production costs for the industry. Due to the impact this had on the performance of jewellers island-wide, we lobbied the current government requesting this duty to be removed. After careful consideration, H.E. Gotabaya Rajapaksha granted this duty relief which was a lifeline to the 250,000 traders.The Port and Airport Development Levy (PAL) imposed on gems and diamonds have also been removed.

The Sri Lankan government has actively sourced vaccines for the people of its nation uplifting the lifestyle of its people and allowing traders to resume business.

How important is the jewellery sector in contributing to Sri Lankas economic growth?

Sri Lanka has been known for its jewellery craft and gemstones going as far back as 250BC, playing a pivotal role in the nation’s growth. Recently it has been estimated that the jewellery industry contributes north of 600m dollars per year to the overall economy. The jewellery industry is also a key employer to the nation with more than 650,000 individuals currently involved in the services provided.

How have you ensured that the jewellery business keeps running smoothly despite roadblocks in the country?

The jewellery merchants are a resilient bunch of people, fighting through various setbacks in a challenging year. As the president of the Sri Lanka jewellers association, I have spoken to various government representatives with the support of my team in order to achieve stability and sustainability within this industry. One of our biggest wins recently is the ability to remove the customs duty we discussed earlier, along with VAT and Port and Airport Development Levy. Furthermore, we have also significantly simplified the import-export procedures that were in place in order to boost confidence in local traders and international customers. With guidance from the leadership team of the Sri Lanka jewellers organisation, we were able to keep all our traders informed of latest changes within the rules and regulations and helped them navigate this unprecedented year.

Exports form a major part of the jewellery retail business. Have there been initiatives to keep the pipeline smooth?

Yes, as we briefly discussed above, exports play a key part in the jewellery sector. As a nation recognised for its craftsmanship and rare gemstones, we need to constantly consider more efficient ways of doing business internationally and alleviating any pain points within the current structure. In order to address this, we got in touch with government representatives requesting for the current procedures outlined for the gem and jewellery industry to be streamlined and be made more effective. An import and exports Gem Office at the International Airport in Katunayake was set up in order to expedite the clearance of gemstones and jewellery.

What special initiatives have been taken for retailers in respect to cash flow, which is very important to the business?

An initiative that the Sri Lankan Jewellers association took during this difficult time was to help the struggling jewellery businesses secure short-term funding at low interest rates in order to keep their businesses afloat and meet monthly overheads. We also requested some of the key players in the industry to meet their creditor payments sooner in order to facilitate smoother circulation of funds for sole traders and other small businesses. 

With another wave hitting most nation, how does the association plan to battle it out keeping in mind the jewellery industry’s best interest at heart?

We have accelerated the vaccine programme for a lot of the members in the jewellery industry, setting up clinics targeted to help the industry. We have outlined strict guidelines to help prevent the spread of any further variants and curtail potential impact on the industry. We have also requested for increased random testing within busier regions of the market in order to identify potential cases early and provide the appropriate healthcare necessary as early as possible. All staff members have been asked strictly to follow the rules to ensure the safety of our customers.

What is the plan for the future?

The short-term plan is to recover from the Covid impact and get back on our feet to achieve pre-pandemic levels. We will support our members in every way possible to get through these challenging times and identify future reliefs that can be beneficial for our traders.

Over the longer term, we aim to make Sri Lanka the hub for the gem and jewellery industry, With the expected increase in tourism and the various government projects (such as Port City Colombo), we believe there is significant growth potential for this sector within Sri Lanka. The development of technology has many benefits that we think will be useful to our industry. A key example of this would be the optimisation of the manufacturing process that is currently undertaken in the jewellery industry, allowing significant savings to be made during the process. Another key aspect that technology can influence is with regards to tailoring the designs and services to each customer’s needs and tastes.

Courtesy: Retail Jeweller World News

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *