Lower Import Tax China has witnessed a rapid expansion of its jewellery industry in recent years, with the number of manufacturers soaring from less than 100 to 25,000 and the number of retail outlets growing from scratch to over 20,000. China has achieved a steady growth in both its domestic and export sales of jewellery in spite of a generally sluggish market. There are currently over 10,000 gold jewellery shops and 20,000 specialised jewellers in China. In the course of its development, China's jewellery industry has also seen the emergence of a number of specialised trade marts in different parts of the country.
China imposes strict control over the sale as well as import-export of gold and silver.
Businesses engaging in the production, processing and sale of gold and silver products must be examined and approved by the People's Bank of China and relevant departments, and registered with the administration for industry and commerce in accordance with state regulations and procedures. Against this background, most Hong Kong jewellers have been utilising the mainland as a production base to lower costs rather than targeting it as a market. At present, China levies high tariffs on jewellery imports, which makes it very difficult for foreign players to enter the market through normal channels. China is a major pearl producer with annual output exceeding 1,000 tonnes. Such a high tax burden seriously impedes the import of raw materials for the production of jewellery.