The Israel Diamond Exchange management is asking for state aid for the first time, under the Law for the Encouragement of Capital Investments, in order to save Israel’s contracting diamond manufacturing center.
At a press conference summing up the past year, Diamond Exchange president Shmuel Schnitzer said that Israel’s diamond trading center could not exist without a critical mass of manufacturing. “The decline in local manufacturing is extremely worrying, and casts a heavy shadow over the entire industry. Trading and manufacturing are two inter-related and inseparable fields; each is essential for the other’s existence.” Schnitzer said.
Schnitzer added that the Diamond Exchange intended to lobby the Ministries of Finance and Industry and Trade to grant benefits to diamond polishers in the central region, similar to those enjoyed by high-tech enterprises.
In view of the fact that half of all polished diamonds are not produced in Israel, Schnitzer is proposing additional solutions to diversify and increase imported raw materials, and continued development of a service and robotics plant, which will lower local production costs.
”The combination of these initiatives will preserve Israel’s central status in the global diamond industry,” Schnitzer said.
In summing up diamond industry activity in 2002, Schnitzer commented that the sector had to deal with the global recession and the September 11, 2001 terrorist attacks in the US. “In Israel, these difficulties come on top of the intifada and the expected war in Iraq,” he pointed out.
Schnitzer also said that Asian competition in diamond manufacturing had increased last year. As a result, marketing and distribution costs had risen, which mainly affected small and medium-sized businesses in the industry.
Published by Globes [online] - www.globes.co.il - on February 10, 2003