b'THE STATE OF THE THE JEWELRY THE COLOREDMAJORS DIAMOND DESIGN STONE MARKETINDUSTRYWhile these regional gem centers couldplace isnt necessarily a bad thing: They [the Tan-open the market to more international buy- Pink and red spinel zanian government] had to start somewhere. ers, theyre not without their issues.from northern Tanzania It mightve been uncomfortable, but they The government finished its first gemhad to start somewhere.center in May, choosing to open theAnd the changes have shown some inaugural location in Namanga, whichmonetary benefits. sits on the Tanzania-Kenya border, toAccording to local reports, tanza-test the system. It created some strug- nite revenues rose to approximately gles at first since its not the most cen- $461,000 in September 2018, up from a tral location and is about 110 kilometerslow of about $74,000 in January 2015.(68 miles) from Arusha, where much ofTanzanias government says the the countrys trade occurs.mining sector contributes about 5 percent But the government followed Namangato the countrys GDP. Under Tanzanias De-with a second gem center in Arusha, which isvelopment Vision 2025 plan, its expected to now operational.account for 10 percent in the coming years. Periera brings up another gripe about the gem cen- If the situation in Tanzania proves to see a bene-tersthey are forcing everyone to sell in the same place, whichfitlets say by 2025 they get to 10 percent of the GDP coming presents problems for small miners. He says they dont necessarilyfrom the mineral resources sectorthen youre going to see most of want others to know how much theyre producing or how much mon- their neighbors take notice of that and start to put in similar types of ey they have because it presents a security issue.regulations, GemWorlds Robertson says. It also means more competition for minersif they are able to travel to[National Jeweler reached out to Tanzanias Ministry of Minerals the gem centers at allas buyers can look around before they purchase. for comment on this story but did not receive a reply by deadline.]All these changes are intended to help the Tanzanian government more closely regulate its mineral resources and retain more of their value. While many agree that the idea behind it is positive in the long run, the scale of changes made in a relatively short span of time hasnt made things easy for the trade. I think its creating frustration for the Tanzanians because its a moving target, Dery says. You might set up your business to operate in a particular way based on government regulation, then six months in youre doing it a different way. If youve been at something for only three or four months, you can probably adjust on the fly. But if youve been doing something for 20 years and the government says you cant do it that way anymore, you might have a whole business structure built on what you thought was going to be permanent.Dery also says the ban on rough exports hasnt done much to create more work for the countrys estimated 650-700 gem cutters, from what hes seen and heard. He estimates that the number of cutters and the amount of rough have balanced out.But, 10 years from now, if they have another 600-800 gem cutters who are trained on modern machines, I think youre going to have an escalation in revenue and people choosing that location as a place not just to buy, but a place to take their goods to be cut.Periera says even though he sees the lower 2 percent duty on facetedETHIOPIA FINDING ITS WAYstones encouraging cutting in Tanzania, the countrys cutting sector isntOne of those neighbors, Ethiopia, has already started. established enough to handle the material on the market now.This might not be surprising to anyone watching the supply side of Theyre not yet capable of cutting all the material that we require.colored stones. The 2016 discovery of emeralds in Shakiso refocused Were a long way out. Its impossible at the moment.attention on the country.However, he says that at the end of the day, the new regulationsAccording to Hewan Zewdi, co-founder of Seattle-based Agere and duties will be for the best.Treasures LLC, who travels to Ethiopia and sources directly from Its a step forward. At the moment, its kind of a rough patch;miners, the government is taking its time to learn from other coun-a very rough patch. But I think with time, all the wrinkles will gettries and is engaging the countrys gemstone community for feedback ironed out and in the future it will get smoother. as it develops new rules. Dery agrees, noting that while the government should consider beingUnder consideration is one requiring exporters to receive some less restrictive to allow commerce to occur, having the regulations ingemological education in order to obtain an export license so they have Continued on page 6462 STATE OF THE MAJORS 2019'