President Donald Trump said Thursday that the U.S. is putting 10% tariffs on another $300 billion worth of Chinese goods, effective Sept. 1. This means that starting at the beginning of next month, every single good coming into the U.S. from China, except those with exemptions, will be subject to an import tax. Called the 'tranche four' tariffs, the list includes rough and polished diamonds (whether or not worked), loose 'synthetic ...
To the chagrin of the gem & jewelry industry in the county, the Indian government last Friday (July 5) announced it would increase the import duty on gold and precious metals to 12.5% from current level of 10%. The move will raise the price of gold, silver and other precious metals on the domestic market, with concerns that smuggling may rise and tourists may seek to purchase their gold elsewhere. India is one of the largest gold importers in the world, arising mainly from demand from the jewelry sector. India imported gold worth $32.8 billion during 2018-19.
The withdrawal of India’s beneficiary status under the Generalized System of Preferences (GSP) trade program is expected to have a "moderate" impact on India's exports of gems and jewelry to the US, but will not directly impact diamond exports - contrary to what some have been reporting.
India's rough diamond trade is facing significant difficulties importing diamonds following a customs directive requiring them to submit a detailed description of the imported diamonds, including country of origin, size, type, color and clarity - an 'impossible' demand, representatives say. The fear among traders is that even a minute discrepancy in the norms may lead to seizure of the shipment as well as a large penalty, which could affect manufacturing activity in Surat, the country’s diamond cutting and polishing hub.
The South Korean government, following years of negotiations with the Korea Diamond Exchange (KDE), has abolished the special 26% Individual Consumption Tax (ICT) on imports of loose polished diamonds exceding KRW 5,000,000 ($4,460), leaving in place only the simplified rate of 5% import tax and 10% VAT which already applied to all imports. KDE President Nam Chang-Soo said, "We hope that the abolition of the tax will have a very positive effect on diamond jewelry sales in South Korea."
The partial shutdown of the US government is likely to have had a negative impact on exports of small diamonds from India to the US, according to Colin Shah, vice chairman of the Gem & Jewellery Export Promotion Council (GJEPC). This comes as unwelcome news to an industry that is already experiencing sluggish performance, with The Economic Times citing an 8.5% decline in the value of polished exports in the first nine months of FY2018, sitting at to $22.41 billion.
The Antwerp World Diamond Centre today welcomed the President of Sierra Leone, Julius Maada Bio. The presidential delegation’s visit emphasizes the importance of trade relations between Sierra Leone and the Antwerp diamond industry, and falls within the framework of President Bio's efforts to take his country in a "new direction", which includes a strong focus on revising key legislation pertaining to the mining sector to ensure a win-win situation for the government, mining companies and local communities.
In an open letter to diamond traders, the UK's Foreign and Commonwealth Office addresses the possibility that the UK will temporarily be unable to import and export rough diamonds if the nation leaves the European Union without an exit deal. At the moment, UK traders can trade in rough diamonds within the EU and to countries in the Kimberley Process Certification Scheme, which regulates the international trade in rough diamonds. The EU is a participant of the Kimberley Process (KP) and acts on behalf of the UK.
China will cut import tariffs on nearly 1,500 consumer products as from July 1, including gold jewelry set with diamonds, as well as precious stones, in a bid to boost imports as part of efforts to open up its economy. A total of 18 tax items involving jewelry categories are included in the tariff reduction, with an average tariff rate drop of 68%.
Swiss watch exports saw their strongest growth in more than five years during 2017, according to the Federation of the Swiss Watch Industry. with Hong Kong and mainland China representing the top two markets for Swiss watches. This trend continued to start off 2018, as January sales in Hong Kong rose 21.3 percent to grab a 15 percent of the market, while sales in mainland China surged by 44.3 percent to reach 10.9 percent of the market, overtaking the US.
Swiss watch industry exports rose strongly at the beginning of 2018, boosted by substantial sales growth in Asia, reports the Federation of the Swiss Watch Industry. Year on year, total January exports of wristwatches rose by 12.6% to $1.7 billion (1.6 billion Swiss francs), as the trade benefited from the dynamic performance of previous months and a favourable base effect, the Industry body writes.
The Indian government has raised import duty on cut and polished diamonds and coloured gemstones from 2.5% to 5% in the Union Budget 2018-19, and the country's diamond trade is not pleased. Announcing the 2018 budget, and in an attempt to protect the local industry Finance Minister Arun Jaitley doubled the import duty on cut and polished diamonds, coloured gemstones and lab-grown diamonds and also raised customs duty on imitation jewelry from 15 to 20 percent.
The Antwerp diamond industry had a solid month of trading in October, particularly on the export side, as the value of rough and polished exports both took a turn for the better despite soft midstream demand for rough and a seasonally slow polished landscape. Furthermore, according to figures published by the AWDC, the trend of high volumes of low-value rough exports abated for the first time in months, as the increase in the value of rough exports (+15%) nearly kept pace with the increase in volume (+19%) on a year-over-year basis.
The Bureau d'Évaluation et de Contrôle de Diamant et d'Or (BECDOR) in the Central African Republic, which oversees the country’s production and trade of diamond and gold, maintains a database and assesses the value of diamond parcels that are to be exported from the country, has just set up a new price list - defining mineral prices between government and traders. The new price list for these mineral resources is designed to enable the State to have enough financial resources to meet its obligations, reports APA News (Agence de Presse Africaine).
Driven by strong increases in exports to Hong Kong and China, and even modest 1.4% growth for the U.S., July marked the third straight month of growth for Swiss watch industry exports, according to the Federation of the Swiss Watch Industry FH.
The Indian government’s decision to impose a 0.25 per cent tax on rough diamond imports under the goods and services tax regime (GST) in order to ensure traceability of diamonds will hurt India’s competitiveness, according to diamond industry representatives. India’s Gem & Jewellery Export Promotion Council (GJEPC) criticized the government’s decision to tax rough diamond imports, claiming it will damage the nation’s manufacturing sector, and is urging the government to reconsider its decision.
ALROSA’s new President Sergey Ivanov led a senior delegation from the Russian diamond miner to Antwerp today to get acquainted with their partners at the Antwerp World Diamond Centre.
"Martin Rapaport, chairman of the Rapaport Group, called on India to show reciprocity in its trade relationship with the United States," writes eponymous Rapaport News of their founder's “State of Diamond Industry” presentation at GJEPC's "Mines to Market" conference yesterday, marking 50 years of India’s Gem & Jewellery Export Promotion Council.
The Surat Diamond Association (SDA) and the Gem and Jewellery Export Promotion Council (GJEPC) have written to Prime Minister Narendra Modi requesting the government provide an international airport at Surat as soon as possible to facilitate smooth imports and exports of polished and rough diamonds, write The Times of India. Estimates are that polished diamonds worth $21 billion are processed in Surat and exported to various countries via Mumbai every year, while India imports approximately $14 billion in rough diamonds annually.
ALROSA announced at it annual business meeting with the company’s long-term clients that as of 2017, the company will start regular special-size (+10.8 carats) diamond auctions in Vladivostok, seen as a way to bolster the eastern market, and is planning to resume special-size diamond auctions in New York. ALROSA further announced that in 2017, all competitive bidding will be held online on a platform for electronic tenders developed by the company. Test sales on the new platform were held in 2016 and received a positive feedback from the participants, the statement said.
Small and medium diamond traders in Surat, the world's largest diamond cutting and polishing center, are facing difficult days due to the cash crisis and the government's demonetization decision.
With its industry overview announcing that, "Exports of Swiss watches fell in the first half of 2016 to CHF 9.5 billion ($9.8bn) from CHF 10.2 billion ($10.5bn) in 2015. This is the lowest level since 2011. In July and August the decline continued.
State-owned diamond company Sodiam, which markets Angolan diamonds, is the African state's second-biggest exporter and is the only non-oil firm on Angola’s list of the top 10 exporters in the first quarter of 2016. The biggest exporter is state oil company Sonangol, the country’s Finance Ministry said. Sodiam exported diamonds with a value of around $190 million in the first quarter. Angola exported $1.3 billion of rough diamonds in 2015, according to Kimberley Process figures.
Earlier this year, India's Jet Airways pulled out of Brussels and relocated their operations to Amsterdam, leaving Brussels Airport without a direct flight to India. Today, after having reached an agreement with Air India, Brussels Airlines has announced that they will start flying directly to Mumbai in March 2017.
DiamondCorp reported that two run-of-mine parcels of diamonds which would have formed part of a larger diamond tender in Antwerp scheduled to commence at the end of this month have been sold to South African diamantaires when the company's reserve prices were exceeded during the South African export process. The two parcels comprised 1,838 carats of run-of-mine kimberlite diamonds and 1,679 carats of tailings diamonds, and were sold for an average of $189 per carat and $53 per carat, respectively. Total proceeds received from the sale were almost $440,000.
Panama's World Jewelry Hub has carried out the first export of finished jewelry manufactured in the WJH Free Zone. The transaction was managed under the center’s expanded free-zone license, which now allows manufacturing facilities within its jurisdiction. “This was a small export, but a giant step for the World Jewelry Hub,” said Mahesh Khemlani, President of the World Jewelry and Diamond Hub, Panama, which recently changed its name from the Panama Diamond Exchange.
Venezuela expects to rejoin the Kimberley Process as it seeks to resume diamond exports, its central bank director told Reuters. "We are certain we will rejoin this year," Jose Khan told the news agency on the sidelines of the KP's intercessional meeting taking place in Dubai. Although its exports were tiny, around 3,000 carats a month, it stopped issuing export certificates in 2005 and unilaterally removed itself as an active participant in the Kimberley Process in 2008 as it was unable to verify the legitimacy of its diamonds.
Antwerp World Diamond Centre’s (AWDC) Board of Directors met with Indian Prime Minister Narendra Modi during his visit to Belgium last week and came away pleased that they turned out to be on the same page on several issues. “Obviously we are pleased to see that just a day after our meeting with the prime minister, the Reserve Bank of India (RBI) decided to allow state banks to approve clean credit facility given by foreign suppliers to Indian importers of rough and polished diamonds, even beyond 180 days," said AWDC CEO Ari Epstein.
The Indian government on 30 March exempted from customs duty cut and polished diamonds imported by HRD Antwerp's Mumbai Diamond Institute for grading and re-export, taking the number of such entities enjoying the facility to four. In July last year, the Central Board of Excise and Customs (CBEC) had exempted from customs duties cut and polished diamonds imported for grading or certification and re-export by three laboratories and agencies.
Provisional government data indicate that U.S. polished diamond imports declined 3.2% on the year to $1.77 billion in January. Meanwhile, imports by volume dropped 14% on January 2015 to 912,672 carats, leading to a 12% increase in the average price per carat of polished imports to $1,938. As for polished diamond exports, they fell 8.9% to $1.26 billion.
As the Russian economy worsens and the crisis between Turkey and the Russian Federation remains in deep freeze, Turkish jewelry exporters are looking for new markets for their goods. Producers aim to expand exports by 30% to $3.5 billion this year by focusing on new markets, after seeing decreases of around 15% on the year in 2015 as demand from Russia plunged, reported the Hurriyet newspaper. “Russia and the Turkic republics have been our key markets, but Russian economic activities have ground to a halt since the Ukraine crisis.
Following years of political chaos, the Ivory Coast’s booming economy and improved infrastructure is creating the right climate to attract investment, according to budget minister Abdourahmane Cissé, a 34-year-old former Goldman Sachs trader, The Guardian reports.
According to the Economic Times of India, the Indian government is now "likely" to introduce a favorable tax regime in the 2016 budget for the diamond industry in the Special Notified Zone (SNZ) in order to help develop India as a rough diamond trading hub and help small diamond traders. The gems and jewelry industry has suggested that the turnover tax on diamond trade in the SNZ should not be more than 0.25% and must be internationally competitive.
The country's government has expanded the budget deficit to 3.8% of gross domestic product for the fiscal year starting April 1 as demand drops for its diamonds, its main export category. There is a budget shortfall of $530 million compared to a deficit of $360 million, or 2.8% of GDP in the fiscal year that ends on March 31, Finance Minister Kenneth Matambo told parliament in his budget speech. The scope of the decline in diamond exports is seen in the fact that it will be the country's first deficit in four years.
Around Turkish 2,000 jewelry stores closed down last year as a result of falling jewelry spending due to limitations on the number of credit card payments allowed by the authorities and consumers' desire to spend on electronics and vacations, according to sector representatives cited by the Hurriyet national newspaper. “Our sector has seen a serious contraction," said Emil Güzeliş, the owner of Turkey’s leading jewelry exporter, Zen Pırlanta. "Some 2,000 of 26,000 jewelry stores were closed down last year.
Next year is "unlikely to be an overly painful year for Hong Kong exporters," says the Hong Trade Kong Development Council in a forecast regarding business in 2016. There should be "a more stable - albeit still unspectacular - external trade environment pushing against unabated headwinds. With regard to jewelry, consumer appetite will again be impaired by the shift away from lavish consumption. Most shoppers, thanks to their caution, will likely stick to less pricey articles marked out by good quality and craftsmanship, rather than flashy brands.
Quartz reports that, "In a bid to boost domestic spending and to kickstart its slowing economy, the Chinese government has revealed plans to cut import duties again, having previously slashed them back in May." As of January 1, China will again lower prices on some 800 consumer products including bags, clothes, scarves, and sunglasses.
Despite the huge global publicity for Botswana's diamond industry with news of a 1,111-carat diamond being found by Lucara Diamonds, the country faces an uncertain future as forecasts suggest the gems will run out in 15 years. Successive governments have enjoyed prosperity and stability as a result of Botswana's diamond exports, but they still account for a huge 80 percent of export earnings and around 70 percent of gross domestic product, The U.K.'s Daily Telegraph reported.
The value of jewelry exported via Heathrow airport has increased by 18% over the past two years. The UK customs data released by Heathrow airport found jewelry to be the third most valuable export traveling via the airport at £3 billion ($4.8 billion).
Overseas orders for Indian jewelry have declined by 25% for the Christmas season because of a global economic slowdown, according to the Gems and Jewellery Exports Promotion Council (GJEPC). Indian jewelry manufacturers were hoping for strong Christmas sales on reports of a revival of economic sentiment in the US, to which India contributes nearly 40%. "Jewelry export orders are around 75% of the normal. The US has shown little sign of recovery and orders from the rest of the world are weak," said Praveen Shankar Pandya, chairman of GJEPC.