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    Sri Lanka Has Designs on New Markets for Jewellery


    © International Trade Centre, International Trade Forum - Issue 3/2006

    © W. Schroeder Sri Lanka is looking for new export markets in Europe. An ITC-European Union project is helping Sri Lankan jewellery businesses to upgrade their capabilities to find the latest designs, meet different technical standards and sell to new buyers.

    Artisans in Sri Lanka's gem and jewellery sector are designing new products that reflect the latest trends. Their collections are making inroads in competitive European markets.

    Gem cutting and jewellery making is a tradition that has developed considerably in Sri Lanka, thanks to the expertise and experience of dedicated craftsmen passed on from generation to generation. The country has been exporting gems to Europe for more than 500 years.

    Jewellery production and trade is an important sector, employing approximately 3% to 5% of the workforce, particularly in the gem-rich region in the south-west of the island. In 1997, the Sri Lankan Government implemented policies to help the country become a regional centre for cutting gems, creating jewellery and trading in gold.

    Technical assistance projects over the last 20 years have helped Sri Lanka to export finished jewellery, especially in silver. However, sales to the main export market, Germany, have been steadily declining.

    The Sri Lanka Export Development Board was charged with developing a marketing campaign for gems and jewellery. Together with ITC and the European Commission, it launched a two-year project to export jewellery to European Union markets in October 2005. In a pilot programme, the project is helping 11 companies to catch up with the latest trends in jewellery, produce pieces that comply with technical specifications that vary from market to market and introduce new collections to a broader European market.

    "They were all designing and producing good jewellery, but their products were not picking up the latest trends and they were not in touch with the market," says international project consultant Walter Schröder, a jewellery designer and technical expert who has 19 years' experience in the Sri Lankan gem and jewellery sector.

    Staying on top of trends

    Jewellery trends are constantly evolving. For example, many of today's consumers prefer exotic dangling elements to the square, simpler designs Sri Lankan companies were exporting to the German market. "This trend is coming to Germany, but it is really strong right now in the United Kingdom, Spain and other European countries, where consumers prefer more playful design in jewellery," says Mr Schröder. Colour trends also come and go. Now, consumers are buying pink and dark blue gems, and semi-precious stones such as green peridots and golden-coloured citrines. Mr Schröder worked closely with the companies' designers to inform them about the latest trends and help them adapt their original designs into new lines. Working with three local experts - one in design and two in production - he also gave advice and training on how best to prepare and present collections.

    The result is an impressive collection of silver jewellery - earrings, brooches, rings, bracelets and necklaces - that showcases both the creative talents of the people working in the sector and the country's resources of precious gems.

    Nearly all of the companies are family-owned, small and medium-sized firms that employ between four and 20 people. Each has an in-house designer or someone working on a contract basis. This was a prerequisite for participating in the project.

    "We wanted to make sure that the expertise and knowledge gained during the life of the project was embedded in the local company," says Mr Schröder. "This will ensure continuity when the gem and jewellery project ends in 2007."

    Sri Lanka is looking for new export markets in Europe.
    ITC-European Union project is helping Sri Lankan
    jewellery businesses to upgrade their capabilities to find
    the latest designs, meet different technical standards and
    sell to new buyers.
    © W. Schroeder

    Meeting technical specifications

    Sri Lanka enjoys a reputation for gems and jewellery that meet international quality standards. However, technical standards for jewellery vary. For example, a butterfly screw on a stud earring needs to be thicker for the German market than for the British market. A different standard also exists for clasps on brooches. Gold jewellery must be hallmarked (stamped) to show that it conforms to international legal standards. Sri Lankan jewellers generally have the technical capacity to meet the different standards, but lack information about the specific requirements for each market. Following a period of training and information, the companies each developed many new designs. The project design and technical consultants checked preliminary drawings, then each company went into production with about 40 designs.

    Testing new markets

    As part of the overall marketing campaign, the project consultants carried out a market survey of Germany, Spain and the United Kingdom. Walter Schröder is also eyeing Eastern European markets that have not had a lot of exposure to products from Asian countries, particularly smaller ones such as Sri Lanka. A visit to the Carat exhibition, an international gem and jewellery fair in Budapest, Hungary, in March resulted in five orders totalling €11,000. "They were enthusiastic about the jewellery and very open to buying from Sri Lanka," he reports. An attractive feature of the Sri Lankan sector is production flexibility. "Most other Asian production centres look to supply big numbers, but the manufacturers here are very flexible and are prepared to provide small or medium-sized importers with whatever quantity they want," says Mr Schröder. "This will make it easier to export the collections because buyers can test their markets." In September 2006, company representatives visited the International Jewellery London trade show and the Autumn Fair Birmingham (UK). They made contact with about 50 companies. Mr Schröder says there is "keen interest from four companies" in the collections. Five Sri Lankan company representatives travelled to the Iberjoya trade fair in Madrid, Spain. Plans are under way to exhibit the collections at Carat in 2007.

    A long history Sri Lanka's precious gems have a long history. In the Old Testament of the Bible, King Solomon the Great received gifts from the Queen of Sheba in the 9th century BC, including gems originating from what today is called Sri Lanka. About 90% of the country is reported to be potential gem-bearing land. There are more than 150 precious gem types in the world, including blue, orange-pink, yellow, green and colourless sapphires, rubies, aquamarines, moonstones, alexandrites, spinels, topaz, zircon, peridots, citrines and amethysts. Sri Lanka has over 50 of these gem types.

    For more information, contact Marie-Claude Frauenrath, ITC Associate Trade Promotion Adviser,frauenrath@intracen.org

    Dianna Rienstra, Trade Forum contributing editor, wrote this article with contributions from Natalie Domeisen, Marie-Claude Frauenrath and Prema de Sousa.


    Related sites:
    Sri Lanka Export Development Board
    Sri Lanka Jewellery