fbpx

Traders hope for a boost from new gem laws


The new amendments to the law governing the extraction of gemstones in Myanmar are expected to offer relief for the gem industry in Mandalay.

Industry insiders interviewed by Myanmar Times said they hope the market in Mandalay will bounce back this year after the Pyidaungsu Hluttaw on December 18 amended the tax rates and restrictions on the opening of new mining areas.

Under the amendments, medium and small-scale mining businesses in Hpakant, Kachin State, are permitted to operate after paying the appropriate taxes on mining blocks to the government. Large-scale mining of gems using heavy machinery will remain restricted.

The requirements will control the supply of high-quality gemstones in the local market, while drawing investments and maintaining jobs at the same time.

High-quality gems are scarce in the local market due to excessive mining, said U Myo Myint Naing, secretary of the Mandalay Maha Aung Myay Gems Trading Centre.

“The rarer it is, the more precious a gem becomes. With excessive mining, gems become plentiful and prices drop. If controlled, it will be good both for the government and gem merchants. I think if there is no excessive mining, the market will become better, especially in Mandalay,” he said.

The Maha Aung Myay Kyauk Wine gem market is the principal jade and gems market in Mandalay and is said to support the livelihoods of 50 percent of the city’s residents. It is also the biggest gem market in Myanmar, with up to 500,000 visitors every day and transactions worth up to tens of millions of US dollars taking place.

“You could say that Mandalay’s economy is good if business at the Maha Aung Myay Kyauk Wine gem market is good. Every sector is connected and I would like to see more activity in the market,” said one gem trader.

However, the market has slowed considerably since the early 2000s, gem merchants say.

“Back then, it was quite easy to re-sell a gem. Gems were not as plentiful as they are today. Now, gems are plentiful but of poor quality, just junk stones. In the past, we didn’t need much capital. We could make a profit with what little we had,” said gem trader U Aung Than.

In the current environment, rubies, sapphires, amber, rough jade and finished jade are most commonly traded, said gem trader Ko Yan Naing.

“In fact, high-quality gems are being exported abroad through unofficial routes and we don’t even have a chance to see many quality gems that are produced in our country though they can be found in international markets,” said a gems trader.

Although the new regulations are expected to help Mandalay’s gem industry, the regional government and local businesses should also do their part to boost the sector by organising gem exhibitions as well, said U Myo Myint Naing.

The government already organises official gem expos in Nay Pyi Taw, however, these events are aimed at larger businesses and foreigners and are less beneficial to smaller traders, industry insiders say.

“Although most of the expos are intended for people in the local gems business to buy raw materials, many Chinese traders are participating in them. While we need Chinese traders to act as buyers for the country’s gems, they should be buying from local businesses instead of buying directly from the expos, which hurts local traders,” they said.

Although the Union government has passed the new gemstone laws, Mandalay’s regional government also formed a committee last year to look into legislation covering small-scale gem miners and traders.

The group has already conducted a field study and met with people in Mogok, the heart of ruby mining in Myanmar, said U Tin Aung, head of the committee and Chan Mya Tharsi Township Regional MP.

«Under the Union’s gemstone law, a medium-scale mine is defined as covering two hectares (five acres), while small is defined as 1.2 hectares. However, following those definitions in Mogok would mean there are virtually no mines. I think the regulations are mainly intended to cover jade miners, so we need laws that are more appropriate for small-scale miners and local conditions,” he said.

However, despite the need for some fine tuning, industry insiders are hopeful the new law will help Mandalay’s jade market recover and lead to the re-emergence of new, more sustainable gem mining blocks in Hpakant and other gem-producing areas.

Source: Myanmar Times

To see the original article click link here

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, “Puma Energy”, “MOGE”, “yangon new town”,”MECTEL”, “hydropower”, etc.

.

Looking for foreign investors to invest in your business in Myanmar