Member countries of the Association of Southeast Asian Nations (ASEAN) continue to grow and recover amid macroeconomic and geopolitical challenges. Data from the International Monetary Fund show that GDP ASEAN countries (GDP) grow 5.7 percent in 2022 as markets and borders reopen.
At the 42nd ASEAN Summit in Indonesia in May 2023, the bloc revealed that ASEAN economies are targeting growth of 4.7 percent in 2023 and 5 percent in 2024, driven by domestic consumption. Exports and the rapid recovery in the service sector Suthipong Damrongsakul, Chairman of the ASEAN Gems and Jewelery Association (AGJA) It said Southeast Asia is home to many major manufacturers and exporters in the gem and jewelry business. With low costs of doing business talented workers Production expertise And having a population of approximately 680 million people makes the ASEAN market very competitive.
Suthipong noted that the region still has advantages in sourcing raw materials, logistics, and training institutions. and gemological services There are also well-known laboratories in the region. In addition to being the president of the association Suthipong is also the managing director of Anthani Gemopolis Industrial Estate in Thailand, an estate that focuses exclusively on jewelry production with an area of approximately 155 rai.
Since its founding in 1990, Gemopolis has attracted foreign investors looking to set up production facilities in Thailand. Currently, this large industrial park is home to more than 300 manufacturers, of which over 95 percent are foreign manufacturers from 29 countries and regions, including Europe, India, the United States, China, Russia, the United Arab Emirates, Japan, South Korea, Australia, Malaysia, Singapore. and Hong Kong
Gemopolis continues to expand and grow. This is a testament to the exciting opportunities in Southeast Asia’s jewelry business. Gemopolis has also built two tax-free zone projects in an area of 15,000 square meters specifically for small and medium-sized enterprises. Including some large organizations
“The area will also offer trade and workshop facilities. It’s not just production,” said Suthipong. “The new zones will be completed by the end of 2023 and investors can move in and start operations by March 2024. We will continue to develop the infrastructure. transportation system and services within Gemopolis continue to support new businesses.”
Ermin Siow, advisor to the Federation of Goldsmiths and Jewelers Association of Malaysia, also confirmed the growing importance of ASEAN in the global gem and jewelry business. And Malaysia is one of the key players in the region.
According to Siow, Malaysia primarily produces pure gold jewelry. It accounts for 80 percent of total jewelry production. Of this, 90 percent is 22 carat gold jewelry. Malaysia also produces gemstone jewelry using diamonds, sapphires, rubies, emeralds, pearls and jade.
Malaysia exports most of its jewelry production to the Middle East, Singapore and Hong Kong. This year, Malaysia’s gross domestic product is expected to grow 5 percent, which will help increase the competitiveness of the Malaysian market. Moreover, Malaysia has not Collect goods and services tax VAT and import duties on gold and jewelry products as well.
“Malaysia is the fourth largest jewelry market in ASEAN after Indonesia, Vietnam and Thailand. We are friendly to the business sector but the market is still small. We therefore need to find the right partner to succeed,” adds Siow. “The association also organizes jewelry shows 2-3 times a year as a way for interested buyers to get to know the Malaysian market.”
Meanwhile, the Philippines offers business opportunities for those looking to take advantage of the growing domestic jewelry market.
Mila Florencio, president of The Guild of Philippine Jewelry Inc, says working with the right partner is the key to success in the Philippine jewelry business. She added that the domestic industry is suffering from the loss of skilled workers to industries in the Middle East and China. “There are opportunities for international suppliers to work with Filipino companies to bring products for sale. Because the Philippines has a large domestic market,” Florencio said at a seminar held during the first Jewelery & Gem ASIA Bangkok (JGAB) in April 2023.
Return of AGJA
Efforts are being revived to transform ASEAN into an efficient regional hub for jewelry design, production and export. as well as the production of colored gems Leading this effort is AGJA, which is made up of stakeholders from the growing gem and jewelry sector in Southeast Asia.
ASEAN countries include Brunei, Cambodia, Laos, Indonesia, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam, while AGJA includes members from Japan, China, South Korea, Turkey, Hong Kong, India, Australia and New Zealand.
AGJA was founded in 2018 with a clear direction and objective: creating a platform for knowledge exchange and technological development. as well as promoting expertise in OEM (Original Equipment)
Manufacturer)/ODM (Original Design Manufacturer) of jewelry entrepreneurs in ASEAN
But the group had to delay their plans when the COVID-19 outbreak occurred. It brought the global economy to a halt along with travel and trade. Suthipong said that so far AGJA is resuming operations after a three-year break.
Siow revealed that AGJA was relaunched last September at the Bangkok Gems & Jewelry Fair organized by the Department of International Trade Promotion. Ministry of Commerce and the National Gem and Jewelry Research and Development Institute (Public Organization)
AGJA is preparing to look for support from China. The group aims to attend the China International Import Expo held every November by Shanghai Gems and Jade Exchange.
Siow said AGJA also plans to reach out to the Dubai Multi Commodities Centre, which has previously expressed interest in hosting AGJA’s annual conference in Dubai. The conference is an important part of its program. through the association
“These planned activities are all very important to our return,” Suthipong said. “It is imperative that we organize events for our members to come together and exchange ideas with other stakeholders in the business.”
Regional strength
One of AGJA’s key objectives is to drive design and branding initiatives to take the ASEAN jewelry business to the next level.
Suthipong said “The shift from OEM to ODM is an important component of our efforts to further modernize the jewelry business in ASEAN. Branding and design focused on the Southeast Asian market is the way of the future. And that is the direction we are headed.”
He also emphasized its increasingly important role. of China in driving the growth potential of ASEAN China is ASEAN’s largest trading partner. Bilateral trade reached $669 billion in 2021, up 29 percent from the previous year, according to the World Economic Forum.
Simon Chan, CEO of China Gems & Jade Exchange, said during his speech at JGAB 2023 that opportunities in the gem and jewelry business between ASEAN and China could continue to grow. China’s GDP figures for the first quarter of 2023 are higher than estimated They rose 4.5 percent, while retail jewelry sales in the first quarter increased 14 percent. The colored gemstone business also has good prospects in China.
This is reinforced by continued demand for rubies, sapphires and emeralds. “Gems and jewelry have evolved from being a classy gift for loved ones to an investment option,” Chan reveals.
Suthipong said the AGJA was looking for support from China in trade and technology, while Siow said ASEAN members could also benefit from China’s jewelry manufacturing expertise.
“China is ahead of most markets in terms of production of pure gold jewelry. In the past we often considered Italy or Turkey to be leaders in this field. But now China has also built a reputation for acceptance. It has advanced production technology and is also a leader in exports,” Siow stated.
Going forward, the AGJA will push for a centralized taxation system and free movement of goods in Southeast Asia to stimulate intra-regional trade. Suthipong said the association will represent members in bilateral trade negotiations and exchanges with the government to help push for the creation of this centralized economic bloc.
According to Siow, the gem and jewelry business in ASEAN has a positive outlook due to continued demand in the high-quality jewelry segment. The desire to own luxury jewelry has grown during the pandemic and beyond. This is because consumers in the market want to celebrate people and occasions.
Le Yen, general director of the Vietnam Gemstone Jewelry & Art Crafts Association International Trade Center, agreed, adding that buyers began turning to high-quality gemstones and accessories during the pandemic. “From experience We have seen demand for expensive jewelry soar even in challenging times. This is because these pieces of jewelry are often considered to be for investment purposes,” she continued.
Suthipong stated that China’s opening up of the country will have a positive impact on ASEAN. “The purchasing power of Chinese buyers is increasing. Especially among Gen Z, this group of consumers has begun to buy more jewelry. And we were able to take advantage of this opportunity.”
