Jewelry Blogger - St. Maarten Special Report...August 11, 2007 Reported by J. Larouche





In St. Maarten, the majority of ALL jewelry retailers are owned and operated by those of Indian decent. This reporter has come to the conclusion (unconfirmed as to number of members)  that the majority of Indian owned and operated jewelry retail stores are members of the Indian Merchant Association and many are partners and/or even related in many cases.

Walk from one jewelry store into another and no one is fighting for your business, as if store number one does not close the sale, store number, two, three, four, five, six (and so on) are waiting just a few steps away, ready and waiting to lure consumers into their establishments with a "so-called" great deal on loose diamonds and gemstones or finished jewelry.

What's truly sad about the situation in St. Maarten is that the locals (natives) are struggling to earn a living however, those from India live in palatial homes and send their children to private schools through monopolizing the retail jewelry business on St. Maarten (specifically Front Street).

Front Street is the main thoroughfare, where the majority of tourists disembarking from cruise ships are deposited. While Diamonds International has a firm presence on the island, it is the members of the Indian Merchant Association who are reaping the benefits of ZERO import duty on goods and taking advantage of the open border between the French and Dutch side of the islands and three month stays.

While three year "stay" limits may or may not (yet) apply, anyone can visit St. Maarten for three months, leave, come back and complete process over and over again...

Interviews with locals reveal that many are aware of the Indian Merchant's Association however, do not understand how those who come to live, work and set up retail jewelry businesses are bypassing normal channels to do so. No doubt, a few of these businesses were founded before St Maarten was established as a "must see" port of call for the cruise ship industry. The fact that the Indian Merchant's Association even exists should send up a few red flags among those in government.





St. Maarten's (Dutch side) requires residency be established and the strict adherence to government guidelines in obtaining licensing for establishing and operating businesses. However, one visit to the government offices would make both local and import (start ups) think twice (as it pertains to the process of obtaining legal residency and required licenses to establish any type of business on St. Maarten today).

It is estimated that there are over 20,000 people living and working illegally in St. Maarten. Due to open border crossings between the French and Dutch side, one would find it easy to enter St. Maarten, as easily as one would drive between New York and New Jersey. The government allows one to stay in St. Maarten for up to three months. Upon reaching the three month stay limit, one can fly to a neighboring island and return within 24 hours to continue their stay.

The lack of immigration control, affords the established jewelry retail businesses on St. Maarten to easily shuffle relatives and (trained) employees through an endless loop of entry and re-entry without fear of prosecution thus, keeping down employee costs by rotating experienced employees and family members within their own community.

Poverty on St. Maarten..




Rent a car and go beyond the few blocks of Front Street and you see a people struggling to get by. There is no housing boom for the lower or middle class in St. Maarten, as the people do not earn enough money to build even a modest home.

Yes, there is poverty, as in many parts of the world but, when hundreds of thousands of tourists are deposited in Philipsburg each and every year, one wonders where is the money going and who is reaping the benefits of St. Maarten's tourism boom.

St. Maarten does not impose a real estate tax and it's a bit difficult for legitimate residents to earn a living when one of the main sources of income (jewelry retail sales) are controlled by those who have unlimited funds to establish a business and rotate employees/relatives between island jewelry store chains.

The Indian community is thriving! The average monthly rent on front street can be upwards to $10,000.00 per month and more..

Interviews with locals (natives of St. Maarten) reveals a sadder side to island life. Many do not why the government does not strictly enforce immigration laws. As one local put it "yes, they come around every once and awhile and round people up and cast them off the island but, they come back a few days later."

A mother of four stated, "I don't even earn enough money for food let alone, even dream of the day that I can send my children to private school". Yet another local stated, "If you go visit and see who lives in these mansions on this island, it's those who own the jewelry stores. There can be dozens living in luxury behind those gated homes at one time. They come into town when the ships come in and close their stores when the ships leave."

The Indian community does give back by donating to local charities however, the amount and number of those contributions is unknown..

Who's Benefiting?

No doubt, those who control the jewelry retail industry (on the island) benefit directly through monopolizing the industry. No import duty imposed on jewelry, the rotation of (trained) employees to and from the island (and surrounding islands) - has its financial benefits. One can set up an off-shore company easily and there are no land taxes nor capital gains.





As one resident stated, "I like the Indian community and I take their money when I can get it. When the Indians build a new home they do not like to pay for insurance so they call me up to install their hurricane shutters. I can make up to $60,000.00 in a good week, as they want their new homes completely shuttered up with no exposure to the elements. They figure for what the insurance costs, they can recoup all the money they spent on hurricane proofing their homes within just a few months."


The Problem Solvers..

There are NO problem solvers for this situation in St. Maarten - just contributors. One can look at the Indian Merchant's Association and the government however, one of the main contributor's would be the cruise lines and their "recommended shops" program.





The on board ship's port shopping guides "recommend" specific stores where passengers should shop. No doubt, the majority of the recommendations are for jewelry retail stores in which, the cruise lines reap a commission through the cunning use of a "guarantee purchase program".

If you arrive in St. Maarten on a cruise ship, chances are you have attended a port shopping talk the night before arrival. In addition, you have been bombarded by in-cabin television ads, fliers and coupons prior to arrival. Once you are deposited on St. Maarten, you will then be directed to "recommended" retail jewelry stores via placards proudly stating that a specific jewelry store is "recommended" by your cruise ship. As one local put it, "even if I could open my own store and sell jewelry, clothes or anything else, I do not have the money to compete with the Association. Who's going to recommend my store?"

If you conduct a purchase in a "recommended" jewelry store, you will be presented with a form at the end of your cruise in which you list the items you purchased, where you purchased those items (the name of the store) and the amount you paid. The form is presented as a "guarantee" (read the fine print) for your purchase.





You submit the form on the last night of your cruise and the cruise line has now compiled a list of which "recommended" jewelry stores must pay a commission (a percentage of your total purchase) to the cruise line in exchange for their on-board promotion. This inventory control "pay to play" program is used by the majority of ALL cruise lines and in ALL ports of call including the number one "port of call" seller of retail jewelry - St. Thomas.

This is NOT a fool proof program, as many vacationers arrive home, visit their local jeweler, have the item appraised and find they paid MORE for the item then they would have through their local jeweler.

It's interesting that consumers "trust" their local jeweler to appraise another retailer's goods however, do not trust that very same retailer to sell them the item.

Yes, those on vacation wish to take home a "memory" of their visit to a beautiful tropical island however, jewelry purchased through cruise ships (and ports of call) may become a nightmare for those consumers who have do not shop around for the "best deal".

If you truly wish to purchase a "memory" in the form of jewelry when visiting a "port of call" do NOT pass up the local mom and pop retailers who do NOT advertise and/or participate in "pay to play" cruise ship promotions programs.

These shops are family owned and operated and refuse to PAY a commission to the cruise lines..

Remember, if the cruise line is earning a commission on your jewelry purchase through any type of "guarantee" purchase program scheme, you are more than likely paying more than you have to for the item.

Jewelry Blogger has posted various complaints concerning those who have purchased jewelry through cruise ship "recommended" shop programs. Please review these complaints before you travel, as the experience of others may just save you a bundle of cash on your next cruise vacation.

Follow Up: JB has no additional information on the Indian Merchants Association, as no one would speak with us concerning the structure of the Association. We do not know the names of the jewelry stores who are members. 8-11-07