Sri Lanka plans gold refinery as high import taxes disrupt formal trade

NATIONAL Gem and Jewellery Authority (NGJA) Chairman and Chief Executive Officer Dr. S.P. Chaminda announced that Sri Lanka is exploring the establishment of a domestic gold refinery to produce fine gold locally, as steep import taxes and restrictions continue to disrupt formal gold flows and push the trade underground.

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Addressing the media on Monday he said the proposed refinery would allow Sri Lanka to import less refined gold, process it domestically and supply the refined output to local businessmen, the Central Bank, and export markets.

"We are in the process of discussing with a company. Discussions are ongoing from producing countries such as South Africa, whether the refinery should operate as a primary refinery, capable of processing raw gold, or as a secondary refinery focused on further refining partially processed material. However, we are hoping to conclude discussions within this year," Dr. Chaminda added.

He said such a move could help reduce the need to import fully refined gold subject to high taxes, restore transparency to the gold trade, whilst supporting downstream industries, including gem and jewellery manufacturing and exports.