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Gem market suffers worst decline in 10 years

Growth likely next year after industry suffers 7-10 per cent decline in 2013

Thailand's gem market is anticipating a plunge in revenue of 7-10 per cent this year, the deepest decline in 10 years, hit by several negative factors including a slower economy, reduced purchasing power and political difficulties.

Somchai Phornchindarak, president of the Thai Gem and Jewelry Traders Association (TGJTA) and chairman of the Gems, Jewelry and Precious Metal Confederation of Thailand, said that this year, the total market value for ornaments and jewellery products would be more than US$7 billion (Bt224 billion), a decline from last year, which posted $10 billion.

Normally, the gem market enjoys growth of 5 per cent annually, of which more than 95 per cent is exports and 5 per cent from domestic market. However, if those jewellery products purchased locally by foreign tourists are included, the domestic market accounts for up to 30-40 per cent.

"We expect the overall gem market in Thailand to drop by 7-10 per cent this year, which is the deepest plunge in 10 years. However, we believe that the market will rebound next year," Somchai said.

He said the overall jewellery market would be driven next year by the economic recovery in the United States, which had delayed import orders of jewellery products from Thailand for the past few years.

The US is one of the major export markets for Thailand's gem products along with China and India, as well as new markets such as Russia and the Middle East.

Thailand is the 14th-largest exporter of jewellery products.

Anyarat Pornprakit, chief financial officer of Jubilee Enterprise, said that despite several negative factors, the company's sales of gem products had still increased as its customers are higher-income earners and were affected little by economic and political difficulties. In the first six months, the company's sales grew by 20 per cent compared with the same period last year, which was on target.

"We believe we will achieve 23-per-cent growth for the whole year," Anyarat said.


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