For the first time, Israel’s polished and rough diamond exports broke the $10 billion threshold in 2005. Polished diamond exports totaled $6.7 billion, and rough diamond exports totaled $3.5 billion.
Despite a wave of collapses and cases of fraud in the diamond industry in the first half of 2005, industry leaders are convinced that the industry will show growth in 2006. They said today that the industry was “strong and stable”. Israel imports over half the world’s rough diamonds.
The collapse of six or seven companies last year cost only $20 million. Compared with $6.7 billion in exports and a total turnover of $20 billion (including internal deals), Israeli Diamond Manufacturers Association president Moti Ganz said, “The proportion of collapses was negligible.”
Upon taking office last year Israel Diamond Exchange president Avi Paz undertook a policy of disclosing cases of suspected fraud. He said that, in retrospect, he did not regret this policy, which was intended to cleanse the industry of criminals.
Israel’s net polished diamond exports rose by 5.8% in 2005. Rough diamond exports rose by 20.5%, partly because of increased imports by diamond merchants led by Dan Gertler (who is a partner with Arcadi Gaydamak in Angola), the Benjamin Steimetz group, and Lazare Kaplan International chairman Maurice Tempelsman.
Rough diamond imports grew by 3.2% in 2005 to $5.31 billion, over half the world’s rough diamonds. Polished diamond imports grew by 9.3% to $3.89 billion. Jewelry exports totaled $380 million. Efforts to diversify diamond sources from the De Beers syndicate have succeeded. Imports from De Beers totaled $962 million in 2005 (18% of total imports), the same as in 2004.
Israel currently has 3,000 diamond polishers, out of 15,000 persons in the industry as a whole. Israel had 30,000 diamond polishers a decade ago, and more polishing is expected to be transferred overseas in 2006. The US is still Israel’s main diamond export market, although its share fell from 67% in 2004 to 61% in 2005, despite an absolute growth in exports from $7.03 billion in 2004 to $7 .73 billion in 2005. Hong Kong accounted for 14% of exports (direct exports to China accounted for 1.5%), Belgium 8%, Switzerland 5%, the UK and Japan 2% each, and other destinations 6.5%.
Lev Leviev headed the list of Israel’s top 30 diamond exporters in 2005, exporting $601 million worth of diamonds.
Published by Globes [online], Israel business news - www.globes.co.il - on January 8, 2006