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After a difficult year for the world diamond industry in 2006, Eli Avidar, managing director of the Israel Diamond Institute, is more optimistic about growth figures for this year and looking at 2008 as the Chinese market becomes a major player among world consumers of diamonds.
"We see China as our future market," said Avidar in an interview with The Jerusalem Post. "Our focus will be on China and a large part of our marketing efforts this year will involve significant campaigns to reach out to China and to mark China as a strategic target for the Israeli diamond industry. The move to China is expected to have a positive impact on figures in 2007 and 2008."
He added that China should not be referred to as a country but as a superpower and and should be approached as a continent.
"China has introduced a welcome and significant tax reduction of value-added tax on polished diamond imports, from 65 percent to the current 4%, easing business," said Avidar. "Although this is a positive step, it is still insufficient and we hope that the tax on diamonds will soon be abolished altogether."
Next month, the IDI will open its new liaison office in Hong Kong, which will be the institute's second office abroad, following the launch of IDI in New York in late 2005. The Hong Kong office will be geared towards helping Israeli diamond companies penetrate Asian markets, and will provide information, contacts and office services.
"Today there are 200 million Chinese who are already wealthy at the medium economic level and whose buying habits are similar to those of their counterparts in other parts of the world such as Europe," noted Avidar. "This number is growing annually, being boosted by the enormous growth of well-paid economic segments. As such, China is becoming a major player in the world consumption of diamonds."
Speaking at the Baselworld 2007 conference earlier this month, Avidar announced that the Institute would focus increasingly on providing assistance to Israeli small- and medium-sized companies to forge contacts and expand abroad, calling them the "engine" of the industry.
"The fact is that in most cases, the larger exporters usually already have their own offices abroad. It is the smaller- and medium-sized companies that will be pinpointed to receive our services to a greater degree, especially in our liaison offices in New York and Hong Kong, where they can find market insight, support and hands-on guidance," he said.
Baselworld 2007 brought together watch and jewelry exhibitors from 45 countries to showcase their latest products and collections. The eight-day event attracted some 90,000 industry professionals from 100 countries.
Avidar emphasized that the industry was going through a phase of branding, marketing and initiating new products and projects.
"These developments have seen high-profile strategic partnerships between our diamond companies and jewelers, as well as numerous joint ventures in manufacturing between Israeli and foreign entities," he said.
Furthermore, Avidar pointed out that although 2006 was a difficult year for the world diamond industry, it was still a breakthrough year for Israel in particular, highlighting the opening of Diamdel's global sorting center in Ramat Gan; the launching of Aber Diamond Corp.'s sales office in Israel; the beginning of Alrosa's direct rough sales in Israel; and the hosting of the World Diamond Congress. Next month, Israel will host the annual meeting of the World Diamond Council.