Israel is one of the diamond hubs - a centre where not only rough and polished diamonds are traded, but also the diamond manufacture, especially of large-sized stones, is maintained. The Israeli cutting companies are at the cutting edge in the world, they are equipped with the most up-to-date equipment, which is very sophisticated and developed mainly in the country. the Israeli technological advances, such as diamond cutting lasers, roughing machines, automatic grinding machines and CAD systems are used today throughout the global diamond industry.
The local diamond industry is based on a rich history of diamond cutting and polishing. It has a very valuable experience in polishing large and expensive stones. That is why Israeli manufacturing firms specialize in cutting and polishing large and medium-sized diamonds of any shape. Over the past decade, the Israeli diamantaires have launched a great many new types of diamond cuts.
In addition, Israel places orders for the manufacture of small diamonds in India, China and Africa, and then these stones are exported by Israeli companies to the markets of the North America, Asia, Europe and to other countries.
The supply of rough diamonds to the country is provided mainly through Europe. Israel is one of the largest rough diamond trading centres in the world (Table 1).
Table 1
Israel’s rough diamond imports and exports, 2006-2017
The dynamics of the Israel's imports-exports for the period under review indicates that there is a steady decline in trade volumes, both in value and carat weight. This suggests that other more competitive world diamond trade centres have appeared, and also there is a shift of the Israeli diamond industry’s focus to the development of machinery and technology for processing rough diamonds.
Israel's cutting and polishing industry
Diamond cutting is the oldest industry in Israel that is the most important global centre for polishing and cutting diamonds, taking a leading position in the world for the large diamond manufacture. The country's cutting and polishing industry is one of the top and most advanced in the world. At present, there are about 4 thousand employees at the Israeli diamond cutting enterprises. In general, about 20% of the cut and polished diamonds of all sizes pass through Israel, which allows us to consider the country a world leader in both the manufacture and export of these stones.
In Israel, there are over 400 cutting and polishing firms. More than half of them are based in the Tel Aviv area, where the diamond exchange is also located, as well as in the cities of Netanya and Jerusalem.
The entire diamond business is concentrated in several dozens of cutting and polishing companies and controlled by them, which plays a significant role in the Israel’s trade and finance (Table 2).
Table 2
Israeli top manufacturers’ diamond sales, 2010-2017
$ mn
Prospects for the development of diamond business in Israel
The current stage of the development of the diamond business in Israel is characterized by the following factors:
1. The highly developed infrastructure in combination with a well-developed system of rough diamond purchasing and polished diamonds selling.
2. The close relationship between the leadership and the diamond community in Israel and the full state support of the diamond business.
3. The orientation of the diamond sector towards the import of high-quality rough diamonds and the export of polished diamonds in diamond jewelry allows them to get the maximum profit from the diamond business.
4. The introduction of the advanced technical and technological achievements in the cutting sector provides a high level of labor productivity and product quality.
All these factors will enable the Israeli diamond industry to maintain a long-term leading position in the global diamond business.
Yury Danilov, Ph.D. in Economics, independent analyst and expert
