Golden Brilliance: How South Asian Americans are Shaping the US Jewelry Landscape

For countless generations, South Asian cultures have cherished gold as an integral part of their heritage. Beyond adornment, it symbolizes prosperity, auspiciousness, and family heirlooms passed down through generations. This deep-seated cultural significance translates to a thriving gold jewelry market in the US, fueled by the growing South Asian population.

The vibrant 5.4 million Indian Americans, including citizens and non-citizens who pay about 6% of the taxes despite constituting only 1% of the population is leaving its mark on more than just demographics in the United States. Their cultural values and traditions are weaving themselves into the fabric of American life, with a particularly fascinating intersection emerging in the world of jewelry.

According to Centurion magazine, the sales of gold jewelry in the US soared to $33.2 billion in 2020, expected to reach $63.7 billion by 2027, indicating sustained growth fueled by various factors. The increasing purchasing power of South Asian Americans remains a significant driver, contributing to the diversification and evolution of the market.

Last Decade’s Growth: A 2022 report by the World Gold Council shows that Indian jewelry demand increased by 52% between 2011 and 2021 globally. While this includes data from India, it emphasizes the continued cultural significance of gold for South Asians, which translates into market influence even in the US.

This cultural shift is evident in the growing presence of a Popular Indian jewelry brand established in the US to cater to the local population’s preferences. Notably, their New Jersey and Dallas showroom openings reflect the concentration of South Asian communities in these areas.

The influence extends beyond traditional retailers. Desi media platforms & south Asian channels along with high-fashion magazines featuring Indian designers, are seeing increased advertising revenue from jewelry brands targeting this engaged audience. Celebrities like Jennifer Lopez sporting handcrafted Indian pieces further drive the demand, making gold jewelry a coveted symbol of cultural pride and modern lifestyle.

Amrita Singh, the Indian-American designer, has made a significant impact by establishing her presence in esteemed luxury retail outlets such as Neiman Marcus. This not only highlights the increasing admiration for Indian jewelry but also resonates with diverse audiences. Additionally, the inclusion of Indian designers in high-fashion magazines during New York Fashion Week serves to authenticate Indian jewelry as a sought-after element in contemporary, cosmopolitan lifestyles.

Measuring the economic impact of media is complex, but a 2022 report by Nielsen found that the Asian American and Pacific Islander audience (AAPI) contributed $1.3 trillion to the US economy in 2021. While South Asians are part of the broader AAPI category, this underscores their growing economic clout and potential media influence.

Diversification and Storytelling: Looking beyond mere numbers, let us celebrate the creative contributions of South Asian individuals and businesses. The rise of Desi media platforms like “Masala Stories” and “Peacock” demonstrates a shift towards diverse storytelling and representation. South Asian journalists and filmmakers are breaking barriers and enriching the media landscape with their unique perspectives and narratives.

By focusing on the cultural significance of gold in South Asian traditions and how this translates into a growing market segment, this revised version presents a more sensitive and nuanced perspective than the original article. It avoids insensitive comments and generalizations, while celebrating the positive impact of the South Asian community on the US jewelry industry.

It is not just about a love for gold; it is about identity and belonging. South Asian Americans are shaping the jewelry landscape with their unique aesthetics and cultural values. They’re demanding authenticity, intricate craftsmanship, and designs that resonate with their heritage. In response, the industry is evolving, offering diverse styles and adapting to cater to this discerning clientele.

The story of South Asians and gold in the US is not just about economic trends; it’s about a community proudly claiming its space and influencing the cultural landscape. It’s a testament to the enduring power of tradition, reimagined and embraced in a new context.

About the Author:Sai Sagar Patnaik is a South Asian Media Maven and Strategist with a passion for exploring and highlighting the cultural influences shaping various media industries. As a seasoned professional, Sai brings a unique perspective to the evolving landscape of media and cultural intersections. For inquiries or further discussions, you can reach Sai via email at saisagar.patnaik@gmail.com or by phone at +17326404831.Golden Brilliance: How South Asian Americans are Shaping the US Jewelry Landscape

Read More........ → January 11, 2024

The future of African banking

The future of banking is digital, and Absa CIB is working closely with financial technology (fintech) companies to shape that future. The relationship makes sense, says Robert Cousins, Head of Global Markets Digital Product at Absa Corporate and Investment Banking (CIB).

"Fintechs come with a niche set of capabilities, while as a large bank, we tend to take a more broad-based approach,” he says. “We know that we can’t build the capabilities for every new solution ourselves, so we partner with fintechs to develop those niche solutions.”

A few fintechs have caught Absa’s attention in the foreign exchange (forex, or FX) space – and while the tech often has application in corporate and investment banking, Cousins says that it usually starts out as a consumer solution.

Remittance solutions

“A lot of fintechs are producing diaspora solutions around cross-border remittances, which drive FX flows in Africa,” he says. “They typically don’t have banking licences, so they look to partner with banks to further the reach of their product. We provide them with FX liquidity, which they convert from developed market currencies into African currencies. We also help them with the ‘last mile’ remittance into the beneficiary account – whether it’s a bank account, a mobile money wallet or even a cash pickup in one of our branches.”

Cross-border remittances play a key role in FX liquidity, he adds. Foreign currency flows are boosted as euros, pounds and US dollars come into the continent from people who are sending money “home” to Africa.

“This is a very busy space, and as Absa CIB we have a strong appetite to work with remittance fintechs, because it gives us that FX liquidity,” he explains. “For example, if we have an importer client in Kenya who needs US dollars, we have to get those dollars before we can provide them to him. If we don’t have those FX flows coming in, we can’t service the other side of our business.”

The cross-border theme extends into cryptocurrencies and digital assets, where several fintechs are looking to disrupt Africa’s traditional remittance market. “And again, it starts off in the consumer space, before leading into CIB,” says Cousins.

Data Analytics

That’s not to say that fintechs aren’t active in corporate banking, though. Cousins points to a wide range of digital platforms that are helping corporate treasurers to better manage their FX.

“Among larger corporates, we’re seeing more and more data-driven solutions that help our clients to manage their risk,” he says. “For example, we’re working with a platform which captures the client’s full book of imports, exports and other FX flows and provides a whole suite of analytics. This gives them a risk management view and lets them look at alternatives to how they hedge and manage their risk.”

Another example is a fintech that helps the bank manage its own client base and risk management. “The value-add there is a whole bunch of analytics and insights that would take us ages to build ourselves,” Cousins says.

Solutions for Africa

While Africa has a number of tech hubs (Johannesburg, Cape Town, Nairobi and Lagos being chief among them), Cousins says that the biggest fintech developments are coming from global companies aiming to access the continent’s largely untapped markets.

“One example is a UK-based company that provides cross-border payment solutions to tier one banks that cater for Africa’s exotic corridors,” he says. “Then on the digital asset side, a good example is a distributed platform that largely uses dollar stablecoin (USDC) to facilitate FX flows from the US and UK into Africa.”

Sub-Saharan African currencies tend to be so illiquid that they are classified as “exotic” currencies. African markets are complex, and fintechs in developed markets are looking for partners who can navigate the local landscape for them, rather than having to build the capabilities themselves to manage those complexities. That’s why Absa is quite attractive. Our Pan-African footprint means we can help global fintechs reach into Sub-Saharan Africa.”- by Robert Cousins, Head of Global Markets Digital Product Absa CIB The future of African banking

Read More........ → December 07, 2023

Two IMF Fixes That Could Channel Billions to Africa

The formula for allocating SDRs, an invaluable source of funding, was agreed in 1944 and channels the most money to the richest nations.

It is a truism that the countries and citizens that face the greatest challenges in tackling global problems - from pandemics and food inflation to the climate crisis - are they ones with the least financial resources to address them. Take Covid-19, for instance, in response to which the G7 spent over $6 trillion while the whole of Africa spent just $130 billion over 2020-21.

Novices to international economics might assume that the role of international financial institutions is, at least in part, to correct this. The International Monetary Fund (IMF), after all, is the lender of last resort for many countries, while the World Bank provides billions in loans and grants to low-income nations.

The reality, however, is that all too often, the mandate and instruments of these financial institutions are so limited that they, at best, offer temporary respite to poor countries and, at worst, exacerbate existing inequities.

There is no better example of this in relation to Africa than the recent fiasco around Special Drawing Rights (SDRs). These international assets were established by the IMF to supplement the reserves of member countries. They remain the IMF's only instruments that can provide "quantitative easing" for countries without specific conditions on the use of the finance.

In August 2021, the IMF issued $650 billion in SDRs ostensibly to support countries responding to Covid-19. Yet rather than distribute them based on need, the IMF's board, which is dominated by its largest shareholders - the world's wealthiest countries - decided to issue the SDRs to countries based on how many IMF shares they own. This meant that African countries, who collectively have just 5% of IMF shares, were allocated just $33 billion. Japan and China each got approximately $42 billion of SDRs. The US received $112 billion's worth.

Unsurprisingly, African leaders argued for more and received some support. In May 2021, France had proposed that $100 billion of wealthy countries' SDRs should be reallocated to low- and middle-income countries. A few months later, it committed to rechannel around $10 billion of its SDRs for this goal. In November 2021, China one-upped France by committing to rechannel $10 billion of its SDRs specifically to Africa.

Slowly but surely, more promises trickled in and, at the Paris Summit in June 2023, IMF Director Kristalina Georgieva announced that $100 billion of pledges had been collected. Approximately $60 billion of that, she said, was specifically pledged towards two of the IMF's distribution instruments - its Poverty Reduction and Growth Trust (PRGT) and a newly-created Resilience and Sustainability Trust (RST).

On paper then, it seemed an inequity in the SDR distribution had been - albeit partially and voluntarily - corrected. But a new problem emerged, and remains. Just a tiny proportion of the pledged $100 billion has been disbursed. African countries received just $10.9 billion through the PRGT in 2021-2, while only one country (Rwanda) has received a disbursement through the RST of $320 million. To put this in context, the African Development Bank (AfDB) has, as part of its normal business, approved projects to African countries over the same time period worth approximately $14.5 billion.

From an African perspective, then, it is clear that these international responses - from the initial skewed allocation to their general amorphous "pledges" - have been inadequate and should not be repeated in this or other contexts.

One short-term solution: 

Our view at Development Reimagined is that there are two key solutions to this disappointing outcome going forwards - one short-term and one long-term.

First, in the short-term - and especially as African countries continue to face significant fiscal challenges from the impact of Covid-19 as well as global food and fuel inflation and the need to take action on climate change - there is a strong case for wealthy countries to commit a specific and significant allocation of SDRs to Africa's own institutions, in particular the AfDB. The reallocation of SDRs to the AfDB is rightly a major focus of the COP28 discussions and top priority for the COP28 presidency.

France's $100 billion proposal should be maintained, with at least $50 billion of that earmarked for Africa, which accounts for over 50% of extreme poverty worldwide. If, say, each of the G7 plus three or four other countries were to contribute equally, this would require a pledge of around $5 billion of SDRs each for Africa. 50% of these reallocations ($25 billion) could go to the AfDB, 25% ($12.5 billion) to other African financial institutions, and the remaining 25% to other channels such as the RST or even bilateral swaps.

This is highly feasible, not just because of the disbursement capacity of these African institutions but because the AfDB and others are already designated as "prescribed holders" of SDRs. That means they can hold, convert, and use SDRs.

In addition, the AfDB over the last two years has been designing a "Hybrid Capital Instrument (HCI)" through which new SDRs can be leveraged 3-4 times to on-lend to member countries. It has announced that for the HCI to become operational, the AfDB needs at least five SDR contributor countries. Furthermore, some potential contributor countries have specific ongoing joint funds that could easily be replenished with SDRs. For instance, AfDB and China's Peoples Bank of China (PBOC) together run the Africa Growing Together Fund (AGTF), which was capitalised with $2 billion in 2014 and is due for renewal in 2024.

When it come to climate action, SDRs are also especially useful in that allow countries to address key challenges without incurring additional debt. With the ongoing COP28 forum focusing on innovative mechanisms for scaling up climate finance and development finance, this is a great opportunity for countries to commit to reallocating their SDRs through AfDB and other African financial institutions.

One long-term solution: The second solution to the SDR problem is more systemic and long-term. As our CEO recently explained in a session on global financial architecture reform, the need to reallocate SDRs to African countries would not have arisen if the African continent had a larger share of the $650 billion's worth of new SDRs in the first place.

The current "quota formula" for sharing SDRs was first agreed in 1944 by 44 founding countries. Of those countries, only four were African, of which two (South Africa and Egypt) were not yet independent. At the same time, some founding members, such as the UK and France, were still holding 35 other colonies and argued that this should afford them greater quota shares. This history, along with the SDR fiasco around Covid-19, raises the question of whether a long-term answer is to change the quota formula.The fiasco of SDRs in Africa has shown that the mandate and instruments of financial institutions such as the IMF are far too limited to address the world's current and future problems. If the G7, G20 and other groups of wealthy countries are truly committed to managing future global financial challenges and tackling the climate crisis worldwide, then reallocating SDRs to Africa and African institutions as soon as possible, followed by significantly rectifying the IMF's quota formula in Africa's favour, should be at the top of their agenda. Two IMF Fixes That Could Channel Billions to Africa

Read More........ → December 05, 2023