Local jewellery manufacturers upset over Indian, Chinese invasion

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Local jewellery manufacturers are seemingly angst at what they call “unfair competition” from Chinese and Indian jewellery dealers in the country.

The local jewellers claim the activities of the dealers from India and China, have resulted in their inability to procure gold for their works as they have been priced out of the local gold market by the Far East Asian merchants.

According to Ernestina Bosompem, Chairperson of the Federation of Ashanti Regional Gold Smith and Jewellers, the local jewellery manufacturers rely on small-scale miners for their raw materials, but have been recently pushed away by the Indian and Chinese business men who are buying the minerals at prices higher than the global market price.

“We have been buying our raw materials from the small-scale miners at the global market price. But now we buy them at prices higher than the global market price.

“This is simply because the market now has been flooded by Indians and Chinese who are buying them (gold) at higher prices from the small-scale miners. What is more worrying is that prices of gold in the world market have even gone down, but we are buying it at a high price,” Mrs. Bosompem lamented.

The price of gold offered by the Chinese and Indian dealers has reportedly fuelled activities in the small-scale mining sector, igniting popular interest in illegal mining activities otherwise known as galamsey.

Ms. Bosompem noted that, the local manufacturers did not face such a situation when the central bank was the supplier of the gold, as they bought it at the global market price, but the system has been discontinued.

“Some time ago, the Bank of Ghana were our suppliers. So, all that was required was for us to have a jewellers’ licence. With that, we just go to the Bank of Ghana and buy from them straight away.

“That system was very convenient for us because we bought it at the normal price. But after that system was discontinued, there has been unfair competition from the Indians and Chinese businessmen who are buying it at a higher price,” she added.

Previously, the local jewel manufacturers procured their raw materials from the Precious Minerals Marketing Company (PMMC), a company established in 1963 and initially charged with the responsibility for the purchase and marketing of the country’s diamonds. That system however, collapsed.

Asked why the arrangement was discontinued, the Head of Corporate and E-Commerce at the PMMC, Kpeglo Johnson, said most of the jewellers abused the opportunity and didn’t pay back, making the arrangement unsustainable.

He, however, mentioned that the arrangement can be brought back if the jewellers association writes a formal proposal so that a proper structure can be set to control the process.

“We used to do it but we stopped for a very long time because most of the local jewel manufacturers were not paying and we ran into a lot of debt. As we speak now, some still have not paid.

“What we want them to do is that their association should submit a proposal so that we can now sit down and see how best we can bring that arrangement back,” he said.

 

Source: B&FT