DMIA Hosts Rapaport

March 15, 2005

DMIA Hosts Rapaport

The Diamond Manufacturers and Importers Association of America met in New York City March 14 to welcome new members, network with existing members and hear Martin Rapaport speak on the state of the diamond industry. Rapaport spoke on a wide range of topics, reminding the manufacturers and importers that their key job going forward was not to manufacture and sell diamonds, but to add value to them and market them as emotional symbols of love and commitment. "It's the idea behind the product, not the product itself," said Rapaport.

The diamond expert also spoke at length about protecting diamonds from being besmirched by ongoing links to unfair working conditions in Africa. While praising the Kimberley Process Certification Scheme as helping to keep diamonds that fund conflict out of the diamond stream, he pointed out that today in Africa there are still a million people working in diamond fields who earn a cup of rice a day. Likening them to modern-day slaves, Rapaport said much more needs to be done by the industry to help such workers.

He cited as positive the new Diamond Development Initiative aimed at establishing economically sound business and developmental environments for independent diamond miners in producing countries such as Sierra Leone, Angola and the Democratic Republic of Congo. The DDI includes governments, the United Nations, private concerns such as De Beers, and human rights groups. "We need to come up with economic solutions to political problems," said Rapaport. "We all have to make an effort, so that ultimately, diamond buyers can say 'this diamond makes the world a better place' because it's helped prevent slavery in Africa."

Rapaport also spoke of the actions he's bringing against De Beers and Alrosa, the Russian state owned diamond company, to prevent what he says is too much control of the rough diamond market. He's filed a complaint with the European Commission, which recently approved an ongoing sales relationship between Russia and De Beers. "I'm not against De Beers, I'm fighting for free markets," he said. Trying to keep more diamonds in the open marketplace instead of being sold by De Beers through its sightholders is his goal, he said. He said De Beers exerts too much influence over whom its clients sell to, making it harder for nonsightholder customers to obtain a wide assortment of the diamonds they need.

He also spoke about the growth of the synthetic diamond industry, saying these manmade gems will actually grow demand for natural diamonds, since they will act as entry-level purchases. "Synthetics will only undermine the natural diamond marketplace if they are not disclosed properly or are salted into parcels of natural diamonds," he said. Commending De Beers' research and development of synthetic detection devices, he urged DMIA members to obtain equipment such as De Beers' DiaSure, one of its synthetic diamond detection devices, now available for sale through the Gemological Institute of America. Nevertheless, he said, the cost to screen smaller diamond parcels may be too high and he urged DMIA members to deal only with trusted suppliers who will document their natural diamonds.

Finally, he urged diamantaires to stay tuned into the movement to create more diamond enterprises that benefit blacks throughout southern Africa. He predicted South Africa will prevail in keeping more diamonds in the country, rather than exporting to London by De Beers. Rapaport said that could provide opportunities for U.S. companies to form partnerships with South African concerns to bring such diamonds to the U.S. to be sold.

In other DMIA news, Ronald J. Friedman, president of DMIA, announced that the DMIA website will be up by June, with information on all members and access for retail jewelers to reach them. There will be links to other organizations and to banks, shippers and other support services for the diamond industry. Friedman also announced there will be a 75th anniversary DMIA gala event in April 2006.

Friedman reminded members of the newly reinvigorated Diamond Industry Steering Committee – which is chaired by Jacob Banda, president of the Diamond Dealers Club; Friedman, president of the DMIA; and Basant Johari, president of the Indian Diamond and Colorstone Association – "DISC will be an umbrella organization promoting New York City and the United States as a primary diamond center." The group will convene in early spring to announce its program and expand it to include all of the industry's key stakeholders.

by Peggy Jo Donahue

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