What would French Polynesia be without its black pearl industry?

What would French Polynesia be without its black pearl industry?

In French Polynesia, the profits from the black pearl exports play a major role in its economy. In a time of crisis where the pearl industry is particularly affected, we can have an outline of the social and economic collapse if it comes to disappear completely.

The Tahitian Black Pearl, which used to be the jewel of the Polynesian economy, is today in a state of economic and social emergency. The current crisis that the black pearl market is experiencing has encouraged the experts to wonder what the real reasons are. Is it really, as everyone seem to think, the economic crisis of 2008 that has made the export earnings fall by 35% in regard to 2007? Or does it come from an accumulation of failures of the market instead? And what are the real solutions?

With a GDP of 5.5 billion US dollars in 2005, French Polynesia is the fifth largest economy in the Pacific. Its economy is based on imported goods, tourism, the Tahitian black pearl industry and the financial assistance of France. In 2007, French Polynesia’s exports amounted to $197 million US, of which the major export in value (64% in 2007) is the famous Tahitian black pearl, as it has always been.

The princess of Monaco wearing a
tahitian pearl necklace.

In the early 90’s, France reduced its investments following the end of the nuclear experiments with the closing of “Centre d’expérimentations du Pacifique”. This caused some serious economic difficulties and greatly impacted the unemployment rate. However, Polynesia’s recovery started with the creation of many pearl-producing companies which helped the repopulation of the atolls and the development of airline connections, increasing also tourism. Thus, the pearl industry experienced a strong development (in 1995, cultured pearl exports amounts to 9, 8 billion Pacific francs (EUR 83 million)) on the international market due to Japanese traders and inflation. As the biggest export earnings of the territory, it became French Polynesia’s economic key industry. In 2009, the export value of black pearls rose to 7 billion Pacific francs (about EUR 60 million) representing 60% of the total value of exported products. So, over the last 20 years, the cultivation of black pearls has been fundamental for Polynesia’s social and economic development. Today, it enables French Polynesia not to be an abandoned ex-colony, but on the contrary, it makes it the second black pearl producer and exporter of the World.                                 

However with the 2008 economic crisis followed by the decrease of tourism, black pearl sales and exports have fell significantly. Pearl producers were not able to pay the operating expenses and consequently had to carry out mass redundancies, to sell off at rock-bottom prices which led to a devaluation of the black pearls, and some of them had to stop their activity. Today, 5000 jobs are still in jeopardy. Nevertheless, is that the main explanation for the current bad state of the pearl field? Ever since the boom in this sector, there hasn’t been any control, any regulation or any restriction in the pearl market. In other words, a marketing strategy, which is crucial, has never been implemented for the pearl trade market. As a result, there are lots of frauds, pearl quality has fallen, pearl producers export their production illegally, stolen pearls are sold clandestinely in Asian countries, etc.

Consequently, the PNPP association (“Producteurs de Nacres et de Perles de Polynésie”) asked for an   emergency bailout and the active and immediate support from the politicians. Facing the despair of Polynesians, the government invited in June 2012 Gaetano Cavalier, the president of the International Confederation of Jewellery, Silverware, Diamonds, Pearls and Gems (CIBJO), to help them find a solution. The suggested bailout would consist in buying out the whole pearl production for a better control of its commercialization. But is it really what all the small producers need? And will they agree?

For the first time in the history of the cultured pearl, producers ask for strict measures to be implemented, demanding much more administration and control. Some specialists recommend a full restructuring of the sector, with an emphasis on the narrow connection between the “4 P’s” (that is to say production, price, promotion and place), which will be much more adapted.

Thus, with these new proposals in a time where the economy of French Polynesia is at the lowest, is there a real hope in sight? The only way for the pearl market and thus the economy of the country to know better days is a strict application of measures and penalties. However, will this be really respected by the actors of the pearl industry?

Sofia S.