The Development of Gemstones Trade in China

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The Development of Gemstones Trade in China

• Dr. Ellen Lau
• Managing Director of Asia

(Listed in NASDAQ-CTHR, global supplier of
synthetic Moissanite)
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Worldwide Gemstone Distribution

• Pearls
• Peridot
• Quartz
• Ruby
• Sapphire
• Topaz
• Tourmaline

• Aquamarine
• Coral
• Colored stones
• Diamond
• Emerald
• Fancy Colored Diamond
• Jadeite
• Opal

(Source Secret of Gem Trade by Richard W. Wise)
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Worldwide Gemstone Distribution
Major Gemstone Suppliers in worldwide

• China
• India / Pakistan
• Thailand
• Burma

• Brazil
• Sri Lanka
• Russia
• Australia

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Gemstone Distribution in China

• Diamond
• Hubei,
• Shangdong,
• Guizhou,
• Xinjiang,
• Xizang
• Opal
• Zhejiang
• Pearl
• Jiangsu,
• Zhejiang,
• Hubei,
• Anhui,
• Hubei,
• Hunan

(Picture Source Asso. Prof. ZhiLi, Dept.of
Earth Sciences, Sun Yat-sen University)
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Gemstone Market in China
(Picture Source CMP Asia Ltd.)
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Gemstone Market in China
Economic Growth (Up to 2007 Q1)

• Foreign trade
• 2006 Q1 US371.24 billion
• 2007 Q1 US457.74 billion (23.3)
• Export
• 2006 Q1 US197.25 billion
• 2007 Q1 US252.09 billion (27.8)
• Import
• 2006 Q1 US173.98 billion
• 2007 Q1 US205.65 billion (18.2)

(Source National Bureau of Statistics, China)
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Gemstone Market in China
Economic Growth Annual and Average Gross Income
(Source Euromointor)
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Gemstone Market in China
Economic Growth (Up to 2007 Q1)
(Source National Bureau of Statistics, China)
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Gemstone Market in China
Economic Growth (Up to 2007 Q1)

• 2007 GDP forecastJP Morgan 10.8, up from
  10 Standard Chartered - 10.6, up from 9.7
• More cooling measures may therefore be expected,
  e.g. raising interest rates to reduce the risk of
  overheating

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Gemstone Market in China
Economic Growth (Up to 2007 Q1)

• The government will continue in its efforts to
  rebalance the economy, as it attempts to make
  growth less dependent on exports and investment
• New measures will be carried to boost
  consumption.
• The current-account surplus will narrow from an
  estimated 7.8 of GDP in 2006 to 6.3 of GDP in
  2008.

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Gemstone Market in China
Economic Growth (Up to 2007 Q1)

• Inflation accelerated to 3.3
• Government new policy

(Source Euromointor)
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Gemstone Market in China
Economic Growth (Up to 2007 Q1)

• Consumer price index (CPI) rose 2.7
• Retail sales of consumer goods grew by 14.9

(Source Euromointor)
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Gemstone Market in China
New Taxation Policy in Diamond Exchange

• Adjusting the Taxation Policies on Diamonds at
  Shanghai Diamond Exchange Center
• Taxes on rough diamond and polished diamond
  slashed from 17 to 4

(Source Ministry of Commerce, China)
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Gemstone Market in China
Buying Behavior

• Demand of colored gemstones
• Supply of colored gemstones
• Increased sales in gemstone market

(Source www.colored-stone.com)
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Gemstone Market in China
Buying Behavior
North China

• Divided into three main regions
• North China
• East China
• South China

East China
South China
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Gemstone Market in China
Buying Behavior

• North China (e.g. Beijing, Tianjin, Xian)
• Traditional market
• Fine jewelry market
• Traditional jewelry gold, jade and pearl
• Traditional designs
• Consume for value
• Huge potential for gemstone jewelry market

(Source Asso. Prof. ZhiLi, Dept.of Earth
Sciences, Sun Yat-sen University)
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Gemstone Market in China
Buying Behavior

• South China (e.g. Shenzhen, Guangzhou, Hainan)
• Mature jewelry market
• Rational consumers
• Jewelry consumption

(Source Asso. Prof. ZhiLi, Dept.of Earth
Sciences, Sun Yat-sen University)
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Gemstone Market in China
Buying Behavior

• East China (e.g. Shanghai, Yangzhou, Zuji)
• Deeply influenced by Shanghai culture
• Consolidated foundation
• Fashionable style
• Traditional design
• Fusion design

(Source Asso. Prof. ZhiLi, Dept.of Earth
Sciences, Sun Yat-sen University)
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Gemstone Market in China
Buying Behavior

• Fusion of Art and Technology
• Affordable luxury
• Self-purchasing womens jewelry of choice

• Synthetic Moissanite
• Silicon Carbide
• Highest brilliance, fire, luster and incredible
  hardness
• Expanding gemstone jewelry market with increasing
  demand
• Washington Post remarks Moissanite will become
  important category in jewelry market within next
  decades.

(Source Daily Business, China)
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Development in China

• Chinese culture of placing their assets
• Put money into bank
• Buy stocks
• Gold jewelry
• Unique appraisal system
• Reselling value

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Development in China

• Nowadays
• High purchasing power High education
  standard More frequent travel to have more
  chances to purchase
• new designs out of China

• Joint ventures and enhanced regulation continue
  to improve the jewelry production by
  Improving the overall management systems
  Upgrading the quality of the workforce and
  manufacturing technologies Meeting the
  international standards More choice for
  consumers

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Challenges and Opportunities

• Education
• People
• Policy

(Source Basic Information on China Jewelry
Industry by Cathy Wang)
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Thank you

• Dr. Ellen Lau
• Contact
• Email info_at_charlesandcolvard.com.hk

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