Kate’s sapphire gives royal boost to Lanka as exports jump

Bloomberg: It’s a good thing for Sri Lanka that Kate Middleton didn’t get cold feet. Prince William’s choice of a Ceylon blue-sapphire engagement ring for Middleton, publicised ahead of their April royal UK wedding, became the centrepiece of a Sri Lankan marketing campaign that saw gem exports jump 37 per cent in the year through October.

The National Gem and Jewellery Authority says the value totals $ 77 million so far this year, boosted by Middle East demand for blue sapphires. The drive is part of a broader strategy to reconnect Sri Lanka with global commerce after a 26-year civil war ravaged the economy, which includes a record port-building campaign financed in part by China.

Officials aim to double shipments abroad, which make up one-fifth of the economy, to $ 20 billion by 2020, and in next week’s Budget may unveil measures to help exporters.

“Sri Lanka is favourably located on international shipping lanes, which make it a natural export and transhipment hub with access to 1.5 billion people in its neighbourhood,” said Mark Mobius, who oversees about $ 40 billion in emerging-market assets as Executive Chairman of Franklin Templeton Investments Emerging Markets Group.

Mobius said that his company was studying the Sri Lankan market for purchases of public equity stakes and private investment, with interesting industries including property, hotels, consumer goods and retail.

The country’s benchmark Colombo All-Share Index has fallen about eight per cent this year, less than the 16 per cent decline in the MSCI Asia Pacific Index.