Global economic disputes affect Israel’s diamond industry

The beginning of the year 2019 saw a 22% drop in exports of polished diamonds within Israel’s diamond industry. The reasons attributed for the fall was economic slowdown in addition to other international trade concerns.

Market figures estimate, in the first three quarters of 2019, the exports were at $2.62 billion, lesser than $3.32 billion during the same period from the previous year. According to news sources, 2018 was determined to be a relatively strong year for the diamond industry.

Furthermore, in the third quarter of 2019, the import and export sale of all diamonds dropped 28% in comparison to the figures from the same period last year. On the global scale, the industry is facing a similar decline, owning especially to an ongoing trade war between China and the U.S. In addition, the protests in Hong Kong and other international concerns has affected the industry to a great extent.

Referring to the prevailing situation in the diamond market industry, Yoram Dvash, president of the Israel Diamond Exchange said: “There is a global crisis. The government needs to help out the industry. Everywhere people are helping because they understand that there are difficulties now. Trump’s trade war with China and the Hong Kong protests really influence the industry. Hong Kong accounts for about 30% of our exports. The Hong Kong government said that in recent times the sector that’s been damaged the most there has been the jewelry industry.”

Furthermore, Dvash added the Hong Kong jewelry chains sold billions of dollars of goods in a year, especially to the middle and upper class Chinese who preferred cheaper deals in comparison to mainland China.

As a result China is not granting visas to Chinese willing to travel to Hong Kong which is also putting pressure on business people and in return affecting the economy. This event has paralyzed the number 2 diamond market in the world.

The credit crisis involving several large Indian diamond companies was also impacting the global industry. As a result, the conflict around diamonds and the declining interest in diamonds among the younger population also played a significant role in the loss.