## Sri Lanka to Establish Gold Refinery to Curb Smuggling 📈

The National Gem and Jewellery Authority (NGJA) has announced plans to set up a domestic gold refinery to bypass high import taxes and formalize the trade. • Strategic Shift: The proposed refinery will process raw or partially refined gold (sourced from countries like South Africa) to supply the Central Bank, local jewelers, and export markets. • Tax Hurdles: Current import levies on gold exceed 45%, rendered "commercially unviable" for legitimate businesses under the current IMF program constraints. • Trade Impact: Formal gold imports, which peaked at US$ 649 Mn in 2017, effectively halted following the 2018 tax hikes and subsequent forex crisis. • Economic Goals: • Reduce reliance on high-tax fully refined imports. • Combat gold smuggling and illicit trade. • Strengthen Sri Lanka’s position as a regional hub for gem and jewellery manufacturing. • Timeline: Discussions with international partners are expected to conclude within 2026. _Note: Plans are currently in the discussion phase as a structural solution to fiscal and monetary restrictions._