One of the most discussed matters on the frontline entrenched by fighters for jewelry ethics is the battle against Burmese gems. On July 29, U.S. President George Bush signed a bill laying an embargo on the importation of rubies and jadeite/nephrite from Myanmar to the United States – the Block Burmese JADE Act proposed by Tom Lantos.
Organizations operating in the U.S. jewelry industry are explicitly explaining the essence and contents of the law through the specialized mass media.
On the whole the law prohibits the importation of jadeites and rubies “mined or extracted” from Burma, including jewelry containing Burmese gems.
“In essence, this act closes the loophole that allowed stones to be recut outside of Burma and no longer be considered as “Burmese origin” when imported,” said Chris Smith, vice president of the American Gemological Laboratories. “The bill now states that it is the intrinsic quality of the ruby/jadeite, as well as the geologic origination within Burma that accounts for the majority of the value, as opposed to the cutting and polishing.”
As Smith explains, the law contains provisions for what constitutes ‘non-Burmese origin’ goods, as well as ‘Burmese origin’ goods that can be exempt from this ban; however they have taken significant steps to make the importation of these goods more difficult.
“There are no provisions in this Bill that limit ‘our’ or any labs ability to determine origin, or require any action that must be taken if we conclude that a ruby is from Burma,” states Smith. “The onus is on the owner/importer to validate that such a stone would be exempt from the ban and have been imported legally into the US.”
As written in the bill, importers are responsible for documentation “with respect to exportation from the country of jadeite or rubies in rough form, a system of verifiable controls on the jadeite or rubies from mine to exportation demonstrating that the jadeite or rubies were not mined or extracted from Burma, and accompanied by officially-validated documentation certifying the country from which the jadeite or rubies were mined or extracted, total carat weight, and value of the jadeite or rubies.”
The same holds true for finished gems and jewelry set with Burmese jadeite or ruby.
“With respect to exportation from the country of articles of jewelry, a system of verifiable controls on the jadeite or rubies from mine to the place of final finishing of the article of jewelry” is to be introduced.
As the bill notes, it is intended to be in force within 60 days of a presidential signature. Cecilia Gardner, president of the Jewelers Vigilance Committee, said it appears that the government will need another Kimberley type process in order to trace country of origin. Gardner is anticipating JVC involvement in that respect.
“In 2006, the Burmese regime earned more than $500 million from oil and gas projects, over $500 million from sale of hardwoods, and in excess of $300 million from the sale of rubies and jade,” according to the bill. “Industry sources estimate that over $100 million annually in Burmese rubies and jade enters the United States.”
As a gemological note, nowhere in the bill does it mention Burmese sapphire, peridot, spinel, or any other gem materials besides jadeite and ruby. So while these could be added in the regulatory process, without industry input, it is questionable that these gems will be included in the Act.
The JVC reminds that the importation ban does not apply to any stones imported for personal use. The bill also does not cover exportation of Burmese gems from the United States. Neither has it prohibited any trade transactions involving Burmese gems already imported in the U.S.A.
Without waiting for the President’s signature, Tiffany & Co. was one of the first to congratulate the U.S. Congress for passing the bill placing a special advertisement in the Washington Post. “This sanction,” the advertisement says, “is an important step by the United States to help secure basic freedoms for the Burmese people.”
Tiffany & Co, along with other jewelers such as Cartier, previously announced that it would not buy gems that are from, or that could possibly be from, Burma. Jewelers of America and the World Jewellery Confederation issued similar statements, calling on their members not to source gemstones from the country.
However, the International Colored Gemstone Association warned against snap decisions to support “a systematic ban on the trade of Burmese gemstones” and recommended that all the parties concerned should weigh all the negative consequences which may have an impact “upon independent and poor populations engaged in mining, processing and trading activities in Myanmar and other countries.”
The American embargo will affect the Thai exporters of rubies, but the scale of damage is questionable taking into consideration the dangerous state of the U.S. economy, the industry participants believe.
Speaking in the Thai Pavilion at the India International Jewellery Show, Somchai Phornchindarak, chief executive officer of the Bangkok Gems and Jewelry Fair and vice president of the Thai Gem and Jewelry Traders Association, said the U.S. ban was a “big problem.” He said the bulk of the rubies imported into Thailand for cutting, polishing and exporting to markets around the world are of Burmese origin, and that their biggest market is the United States.
He said his organization has already had meetings on the subject to find a way to mitigate the situation, but to no avail.
“We still do not have any solution,” he said.
However, traders among the 36 booths in the Thai Pavilion seemed unfazed by the ban, and said they had already turned to new markets due to the ailing U.S. economy.
Sashithorn Assarasakorn, marketing manager for Thai Trading Stone Co. Ltd., said exports to the U.S. market for her company total about 20 percent, down from 30 percent to 40 percent a few years ago. Because of the ban, she said her company will now ship African rubies to the United States. Only time will tell if the U.S. consumer accepts rubies with a lower color quality. Assarasakorn said it will be up to U.S. retail jewelers to explain the situation to their customers.
Salil Shah, managing director of Diamrusa Ltd., said exports to the United States for his company now hover around 10 percent to 11 percent, down from 40 percent a few years ago.
Though he acknowledges the ban will impact his business somewhat, he said he already had begun to shift focus to Asia and Europe.
Even dealers who export a great percentage of the stones to the United States, such as Mehul Patel of New Suren R.O.P. and Suraj Gems Co. Ltd., did not seem flustered by the ban.
“We have to carry on the business and, anyway, the market in the U.S. is down,” he said.
