Penang’s Gold and Jewellery Trade: A Generational Shift is at Hand

By William Tham

November 2021 FEATURE
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After passing through multiple hands, a single pendant finally comes together. Photo by: KOMTAR Gem and Jewellery Design
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THE SUDDEN MARCH rush to buy gold took even Penang’s seasoned jewellers and goldsmiths by surprise. A few timely factors had converged, such as the loosening of some of the stricter regulations of the second MCO, the i-Sinar programme introduced to help citizens afflicted by the pandemic-induced recession, and the general loss of income leading to their right to withdraw money from EPF savings. But most importantly, as pointed out by Teh De Jack, a third-generation jeweller at KOMTAR Gem and Jewellery Design (see Penang Monthly, August 2020),1 the worldwide price per gramme of gold had fallen to a startling low.

During Penang Monthly’s last interview with Teh, the economic impact of Covid-19 had yet to take its full toll, and the landscape has since been subject to wild fluctuations. Customers came to read the market better than they had during the March rush, resulting in the best sales in months – and a depletion of supplies among merchants. The traders of KOMTAR were kept busy in the frenzy, having to control crowds and extending business hours. Despite cryptocurrencies and day trading offering possible huge gains, gold still remains a stable investment.2

In June, jewellers were still having trouble replenishing supplies. With the regulations of the latest MCO in place, the KOMTAR arcade is empty once again; this is the context in which our second exploration of the trade begins. At the time of publication, Teh is just reopening the shop, and the decrease in Covid cases may finally allow for a return to normalcy.

An E-commerce Strategy?

The gold and jewellery trade is highly traditional and depends on various linkages – between the supplier and the jeweller, and the customer and the craftsman. These cannot be transferred online easily. Government directives may look straightforward on paper, but Teh found that a vast amount of jewellery needed to be inventorised and priced daily.

On top of that, he still needed to deliver items to his customers – not an easy feat without an in-house delivery service, especially since the postal service does not accept gold or jewellery. Courier services can be engaged, but the insurance premiums are hefty. And then there is the absence of in-person interactions. Customers can no longer come into the shop to browse or examine a piece before committing to a purchase. Production has also ground to a halt; his equipment and software all had to be locked away. Promising an exact delivery date is impossible under the circumstances, but Teh’s customers are understanding of his situation. But even before this, simply opening up was risky, as was physically moving the jewellery from one craftsman to another during the various stages in crafting the jewellery. “If I need to pass it here and there, with Covid-19 you actually increase the risk of transmission. So Covid might switch the way we work in the future,” he remarks.

Read also: Pit Stop on Penang’s Digital Journey

Adding to these are many other unprecedented complications that have seized the jewellery trade generally. The instability in Myanmar, which supplies over three-quarters of the world’s fei cui jade, means that access to this supply is uncertain. Attending international gemstone trade fairs remains out of the question, although some of them may be resuming. But there are still some light moments in the midst of uncertainty, such as when a self-proclaimed gemologist in China was tricked into declaring online a rubber hose an authentic sample of fei cui, whereupon he was ridiculed over TikTok.

Craftsmen in Crisis

Repairs in progress – Heating a ring prior to starting repair work. Photo by: KOMTAR Gem and Jewellery Design

What happens to the men working behind the scenes: The craftsmen who depend on the trickle of work? They were merely eking out a living from a declining trade before the first MCO, and as far as Teh knows, even the most youthful of Penang’s craftsmen are middle-aged and not long from retirement. Few young individuals are willing to join the trade, and this would mean outsourcing the work in the future, perhaps abroad to Thailand.

There is an old-world quaintness at play when it comes to heritage craft work. Generally, the craftsmen work on a contract basis and live all across the city – a couple of years ago, I was in a car with Teh as he ran a work errand, driving a long distance to a residence to deliver material directly to the craftsman in question.

Upon reaching a consensus between the craftsmen and the customer on the exact shape and dimensions of a custom piece, different specialists would begin their work – casting and setting stones and polishing. For that reason, Teh’s family’s plans to become a one-stop centre for jewellery work has its limitations. They can perform some work besides just designing and planning, and equipment such as a good-quality microscope can be purchased, yet the craftsman’s role remains a symbiotic one.

While the salesman is more familiar with the latest trends and can whittle down a customer’s expectations accordingly, they cannot make up for the craftsman’s years of experience, the muscle memory and time-tested techniques that fuse together practicalities and aesthetics into a single piece of jewellery. This also requires a need to understand what the craftsmen can manage before agreeing to do work for a customer. “If I’m unsure and have not made a deal yet, I will speak to the craftsman to make sure it can be done,” Teh says.

The recession has compounded matters – already working on a freelance basis and not making much money per job, a craftsman’s income is a precarious, volume-dependent one. One of them was having difficulties financing his house, without social security savings to draw on and his Bantuan Prihatin Nasional aid being insufficient.

In the end, the craftsmen are subject to the same irregularities and insecurities as in the much-touted gig economy, but given their relative age and specialised skills, adaptation would be more difficult. For now, there is still another lifeline through the fortunate recognition of their work. George Town World Heritage Incorporated, seeing the need to lend support to heritage crafts, has provided an opportunity for the craftsmen to film a video of their craft in order to earn a grant, which Teh helped to shoot.

Nostalgia at Work

Repairs in progress – Polishing a ring using a rotary tool. Photo by: KOMTAR Gem and Jewellery Design

Whatever happens, gold will retain its economic value, even if it has been displaced from its historical central importance after the gold standard was replaced by the preference for currency valuation (read: the U.S. dollar as the main benchmark worldwide). Yet this did not stop Dr. Mahathir, during his brief second term in office as prime minister, to call for the use of a gold-pegged common trading currency for East Asia.3 There is also its role in the popular imagination and its place in history: The region has been historically referred to as Suvarnabhumi, the Land of Gold, now also the proud name of Bangkok’s international airport. Hence the continued survival of the gold trade is not surprising.

Ultimately, the main difference between the younger jewellers of Teh’s generation and the older one is not the need to better satisfy customers or to keep up with trends, but the need to be more deeply wired into the global financial and commodity market. “Nowadays, you need to look at gold prices every single day. You do need to be quite sensitive. A day’s fluctuation can mean quite a huge difference. You can go into the red nowadays with today’s margins.”

In addition to a general reduced supply of gold worldwide, there is increased competition from online vendors, which shaves the thin profit margins even further. This is not to say that the old traders had it easy. They have always had to be savvy, negotiating and understanding the networks of trade and mining and the different hands the gold and gems passed through, but jewellers today are plugged into the world economy and its crises to a more significant degree.

For now, old customer habits still thrive. There are always people still coming in to purchase jewellery, even if finances are tight, or at least requesting repairs – perhaps inevitably, the newer pieces are the ones that are most fragile. Changing trends in favour of lighter, delicate pieces means that compared to the solid gold items of the past, today’s jewellery is more subject to wear and tear. “Even if you bring it in for repairs, there is only a limited number of times you can repair something. If the same spot keeps breaking, it might be time for you to change the item,” Teh cautions.

There is usually sentimental value attached to heritage jewellery, but customers can also get attached to newer items. Teh recounts how a customer who had commissioned a ring with Chinese motifs spent months tracking down its thief, dramatically confronting the man with an irrefutable piece of evidence – his name was still found engraved on the ring.

As one would expect, the jeweller’s trade holds many stories, linking the future and past, navigating the digital and analogical worlds.

William Tham

first novel, Kings of Petaling Street, was shortlisted for the Penang Book Prize in 2017. His second novel, The Last Days, was published in 2020. He is the editor of Paper & Text, a collection of essays on Malaysian literature and the book trade.