Sri Lanka gemstone reserves proposed as new foreign exchange asset

Industry experts are proposing that Sri Lanka establish a national gemstone reserve to serve as a strategic foreign exchange asset, similar to the country’s existing gold and dollar reserves. Dr. Sanjeewa Fonseka, Director of the Sri Lanka Miners and Dealers Association, suggests that a structured reserve could strengthen the nation’s position in the global jewelry market and provide a new economic lifeline as the country recovers from its recent economic crisis.

The initiative aims to transform Sri Lanka from a primary source of raw stones into a regional hub for value addition. This would involve importing rough gemstones from major producing nations, such as Madagascar, for domestic cutting, polishing, and manufacturing. Proponents argue that this approach would increase the volume of trade and generate additional hard currency through high-value exports.

To support this transition, industry leaders are calling for increased access to finance for businesses importing rough stones, further reductions in import taxes, and the removal of regulatory barriers. Formalizing gem reserves is seen as a way to attract structured investment and increase regulatory oversight to curb illicit trading, ensuring more revenue flows into the national economy.