Egypt is one of the three major jewellery
producers in the Middle East using more than 100 tonnes (3.22 million oz) a year.
In 2001, 96 tonnes (3.10 million oz) were used to make gold jewellery products,
predominantly for the Egyptian home market.
Most of the jewellery manufacture
is carried out in and around Cairo. There is also some manufacturing in Alexandria.
Approximately 3,000 production units are engaged in making the jewellery but
only a handful are industrial-style factories. The jewellery is produced in
the main by small, two to three person workshops.
The staple items are 21
carat
bangles and earrings, purchased by the local population as a store of value.
This is particularly true for the people of Upper Egypt and the millions of
villagers who have migrated to Cairo. However, in line with modernisation
and the deregulation of the economy, there has been a growing trend toward
18 carat, more European style jewellery, which is preferred by the urban populations. Across the country, the
breakdown is approximately 70% in 21 carat and 30% in 18 carat.
Egypt has
an official hallmarking
system based on the British model and set up in the 1920's. The Assay
Office in Cairo handles most of the jewellery volume. Titles admitted
are 23.5 carat, 21 carat, 18 carat and 14 carat, but most jewellery is
in 18 or 21 carat. The making charge is 20 piastres per gram for local
products and 60 piastres per gram for imported items. There is a sales
tax on gold jewellery of 2.0 and 1.23 Egyptian pounds on 18 and 21 carat
items respectively. The sales tax was widened in 2001 to include both
wholesale (Stage Two) and retail operations (Stage Three). (Beforehand
the sales tax had applied to only the manufacturing sector, referred to
a Stage One.) The charges, noted above, are inclusive of Stages One through
to Three. However, to calculate the total charges, which jewellers face,
income tax and stamping fees must be added to the above fees, which are
400 piastres for both 18 and 21 carat pieces.
The Egyptian gold jewellery
market ranks amongst the top ten worldwide. Consumption in 2001 stood at 116
tonnes (3.73 million oz), compared with 128 tonnes (4.12 million oz) the year
before. Over the past decade, the share of imported jewellery of total consumption,
has declined and last year stood at close to just 6%.
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