Nuntawan Sakuntanaga, President of the GIT-Gem and Jewelry Institute of Thailand (Public Organization), outlines her vision for Thailand’s future as an increasingly prominent gemstone and jewellery trading hub.
What is the outlook for the next five years for the gems and jewelry industry?
This may come as a surprise to some consumers but a very large portion of the jewelry they see in many countries including the US, the EU, Hong Kong, the Middle East and Japan, is made in Thailand.
For over a decade, gem and jewelry products have maintained their position as Thailand’s third most important export product, following automobiles and computers.
For the first half of 2020, the export value of Thailand’s gem and jewelry products reached the highest rank at 10,077.60 million USD. Moreover, Thailand is the world’s third largest colored stone exporter and has also solidly held its rank as the world’s largest silver jewelry exporter.
Thailand has an advantage in its knowledge of colored stone enhancement – the local wisdom in heat treatment, exquisite polishing skills, and fine craftsmanship in jewelry production. The craftsmanship cannot be replaced by automated equipment or modern technologies.
Different enhancement methods used lead to different levels of gem quality. Gemstones from reputable sources, like Burmese ruby, Sri Lankan blue sapphire, Colombian emerald, are more expensive than those from other sources. These factors are related to the price of the gemstone. Thus, in-depth product details help consumers get the products that are worth their money.
The younger generations like the Millennials place importance on responsibilities to the environment as well as transparency and ethics in business operations like responsible mining and conflict-free gemstones. Many jewelry brands, claiming their products are made with a high sense of ethics, traceability and transparency, tend to gain popularity among this group of consumers. This trend seems to have also led to the growth of the lab-grown, synthetic gemstone market sector that also claims to be ethical and environmentally-friendly.
As a result, in order to maintain the Thai gem and jewelry industry’s competitiveness and keep businesses afloat in the long run, entrepreneurs have to increase buyers and consumers’ confidence in product quality and operate their business ethically and sustainably with responsibilities both to society and the environment.
What are GIT’s biggest priorities for 2020-2021?
GIT’s main mission is to build confidence in Thai products, namely gemstones, precious metals and jewelry among domestic and overseas buyers through testing and issuing of quality certificates, as well as to develop and upskill personnel for the industry.
Due to Covid-19, business has slowed considerably in every sector. We will use this period to strengthen the industry’s standards and infrastructure. In order to help Thai entrepreneurs thrive in the long run during 2020-2021, we will prioritise two projects.
We will develop colored stone markets in Chanthaburi, a province well-known as a sourcing hub, to become a “Standardized Gem Marketplace” where buyers from around the world can conveniently and confidently source products. GIT has collaborated with local gem trader associations in promoting colored stone trading through product quality certificate issuance under GIT’s “Buy with Confidence” (BWC) project. Having a quality certificate attached to each product will create buyers’ confidence and help sellers trade their products more easily.
GIT recently set up GIT Gems and Precious Metals Standard in September 2020. The GIT standard aims to upgrade the gem and precious metals testing private laboratories or purchasing/QC laboratory sections in jewelry factories nationwide. But, since the standard is on a voluntary basis, GIT will initially form a group of pioneer labs and factories, and provide them both consultation and assessment until these labs reach the standard. GIT laboratory experts will regularly follow up and advise until all labs are able to sustain the standards in the long term.
What kind of initiatives is GIT taking to continue to grow Thailand as the gemstone capital of Asia?
Thailand has gained its competitive edge because of its local wisdom in enhancing the quality of gemstones and its skilled, value adding gem cutters. More than 10,000 skillful gemstone cutters have also created glistening sparkles to the colored stones. These two factors create high demand for Thailand’s polished gemstones.
In order to maintain our status as a world’s gemstone capital, PR & marketing activities need to be done earnestly and continuously. GIT has collaborated with alliance agencies and local entrepreneurs to promote and push Chanthaburi to become the “City of Gems.” We plan to organize gem and jewelry fairs in Chanthaburi annually. Trading areas will be arranged across the city, where both Thai and foreign buyers and sellers are welcomed. The fairs will be similar to the Tucson Gems Fair in the US.
What is your view on general trade trends and developments, given the recent situation with US-China trade tensions and then Covid-19?
As a matter of fact, world trade had dwindled since last year due to the trade war between the US and China, the continued protests in Hong Kong and Brexit. These factors corroded confidence as well as the purchasing power of people around the world. The COVID-19 pandemic has worsened and quickened the recession. It is impossible for any country to avoid the impact. Decline in sales, halted business operations, delayed or cancelled orders are apparent in the jewelry sector too.
More synthetic gemstones have been available on the market as alternatives for consumers at almost half the price of their natural counterpart. Constantly rising gold prices have affected fine jewelry’s price per unit, while sanitation measures have disrupted international travelling and raised costs.
Business recovery could be ensured only after a vaccine is available. I believe demand for gem and jewelry products will pick up. An example can be seen in China. After the government declared the end of its lockdown and shops resumed their normal operations, there were long lines of Chinese shoppers in front of brand-name shops waiting to buy products including jewelry.
Consumer behaviors may move towards increasing usage of online platforms or digital platforms. So they need to be reassured of the quality, pricing and return policies. Retailers need to adapt accordingly.
(Article by Isabella Yan, sponsored by Jewelry Trade Center, Bangkok)