National Gem and Jewellery Authority-Gem Talk-Dec 2007

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"We are very pleased and thankful to all the staff at the National Gem and Jewellery Authority of Sri Lanka  for giving us kind permission to reproduce articles from Gem Talk sept 2007"

"Due to the efforts of National Gem and Jewelry Authority , Sri Lanka has now become one of the rapidly growing gem and jewellery trade centers in the world, we really appreciate all the hard work"

 

Business Principles

 

Business Principles govern how a company conducts itself.They should be based on the firm belief that application of good principles is fundamental to business success.

 

Business principles should consist of core values ,responsibilities to stakeholders and a set of principles of how a company conducts its affairs.All companies and entities no matter their size should adhere to these business principles.These principles apply not only to private sector entities but are relevant to public sector organizations.

In this context ,provision of products and services that consistently offer value in terms of price,quality,honesty,integrity and fairness are applied in all aspects of Gem and Jewellery trade and the same is expected inrelationships with business partners.

The Gem and Jewellery trade known as the "Happiness Trade" which is expected to make all stakeholders happy,is essentially based on honesty and integrity.Adherence to good business principles would undoubtedly pave way for your success in business.

Editoral Committee.


 

Chairman's Message

It is encouraging to note that the gem and jewellery sector has recorded an overall growth of 14% during the 1st eight months of 2007 in comparism with the corresponding figure of 2006.

Under the guidance of Hon. Dr Sarath Amunugama, Minister of Enterprise Development and Investment Promotion who is assisted by Hon.Mano Wijeyeratne Minister of Enterprise Development; series of proposals have been submitted to be incorporated in the budget proposals for 2008,which would further facilitate the industry.

In it's endeavors to promote the industry the National Gem and Jewellery Authority "NGJA" has made arrangements to organize "Sri Lanka Pavillion's" at eight major gem and jewellery shows in 2008.

The National Gem and Jewellery Authority (NGJA) is in the process of finalizing arrangements with Sri Lanka Gem and Jewellery Association to establish a state of the art Gem Testing Laboratory equipped with modern equipment, which will issue an internationally accecpted certificate.

The Authority has also launched an e-commerce facility through it's website srilankagemautho.com, providing the opportunity to local gem and jewellery traders to offer their products for sale on line.

I am happy to state that the National Gem and Jewellery Authority continues to play a strong leadership role guiding the industry on a steady path of expansion and growth while upholding the best interest of all stakeholders.

Hasitha Tillekeratne.

Chairman

National Gem and Jewellery Authority.


 

Big Boost for the Gem and Jewellery Sector

Interview with Mr Thosapala Hewage, secretary to the ministry of Enterprise Development and Investment Promotion.

By Janaka Perera.

A state of the art gem testing laboratory is in the offing according to secretary of the Ministry of Enterprice Development and Investment Promotion Mr Thospala Hewage. He told gem talk that this is one of the several programmes being introduced to boost the countries gem and jewellery industry.

The purpose of the Gem Testing Laboratory will be to further enhance the reputation of Sri Lanka as a prime source of fine natural gems, by positively identifying and certifying them with the help of modern equipment.

Several discussions held and matters are being finalized between the National Gem and Jewellery Authority (NGJA) and Sri Lanka Gem and Jewellery Association (SLGJA) under the guidance of the ministry.

The Ministry has noticed that

miners and small scale gem industrialists

do not reap the full benefits of their efforts

due to the presence of middle-men as

in the case of paddy and

vegetable cultivators

A welfare and insurance scheme for miners is among other projects on the cards. Miners will be given specialized training and introduced to safe mining methods.

The tax structure, Mr Hewage said, has already been changed in order to safeguard this industry which the government has recognized as one of the key areas in the economy because of the vast potential in the gem and jewellery sector especially in the jewellery manufacturing and diamond cutting industry.

The Government is providing a comprehensive array of fiscal and financial incentives to companies investing in the gem and jewellery manufacturing industry. A new enterprise in this area with a minimum investment of at least Rs50 million and exporting not less than 80% of output is entitled to a three year tax holiday followed by two years at a 10% corporate tax and 20% thereafter.

Further all imports of precious metals and gems (including diamonds) have been exempted from the application of duty and value added tax (VAT) under Sri Lanka laws. These policies have been framed with the objectives of making Sri Lanka a center for manufacturing, trading and retailing of gems, precious metals and jewellery.

Port and Airport development levy (PAL) have been removed on gem, diamond and gold import with effect from January 1st 2007.VAT rate on supply of jewellery has been reduced from 20% to 5% with effect from the above date. Concessionary PAL rate of 2% for selected plant and machinery imported for high value adding industry has been introduced.

Under SME sector Rs 13,295 million has been allocated at concessionary rate of interest.A tax free threshold of Rs 600,000 for medium scale partnerships has also been introduced. Among the other incentives is a non refundable vat of 5% on turnover for SME for a period of three years or until turnover reaches Rs2.5 million.

This years export performance in the gem and jewellery sector up to August amounted to a total of Rs 33.2 billion in comparism to Rs 44.9 billion for the whole of 2006.

The tax reforms, Mr Hewage said, is in accordance with Mahinda Chintana which aims to propel the economy to a high growth path. Sri Lanka, he recalled was the first country to receive tariff preferences under the Generalized System of Preferences (GSP+) Scheme and remains the only counter in the region except for Mongolia to receive this privileged status.

Under the taxation changes a 15% cess has been imposed on the importation of jewellery,an annual registration fee of Rs5000 will be imposed on jewellery manufacturers and an economic service charge(ESC) of 1% will be applicable for local jewellery manufacturers..

Also to be introduced is an exclusive

investment promotion zone dedicated to the

gem industry in accordance with His Excellency

 The President's Mahinda Chintana Programme.

Here foreign investment will be promoted via the Board of Investment (BOI). The  Free Trade Agreement between Pakistan and India is expected to facilitate this project. Under this scheme exhibitions will be held, where India and Pakistan will have the opportunity of promoting their gem and jewellery products and in turn Sri Lanka will have a chance of promoting hers in exhibitions held in two countries. Products to which 30% value will be added here ,will be treated as Sri Lankan products.

In expanding the gem industry, Mr Hewage observed the need of the National Gem and Jewellery Authority to build up greater coordination with different state establishment such as the Forest Department and the Wild Life Conservation Department since many gem deposits are found within the wild life santuries and natural reserves.Gem prospecting would have to be done in these areas with minimum damage to the natural environment using advanced mining techniques.

Mr Hewege added that Sri Lanka's competitive advantage in the gem and jewellery sector is based on its:

(a)Long history of its artisan culture

(b)Competitive wage rates for skilled and semi-skilled workers

(c)Availability of a wide variety of precious and semi-precious stones.

(d)Existence of a special gem and jewellery development zone to facilitate quick start up and access to skilled workers and gem stones and

(e) A business friendly government, with the minimum formalities and a wide array of tax incentives.

 

You are welcome to discuss this post/related topics with Dr Shihaan and other experts from around the world in our FORUMS (forums.internetstones.com)

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