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Weak Demand from U.S. Further Erodes Armenia Polished Diamond Sector
Jul 26, 2007 6:23 AM
By Avi Krawitz
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RAPAPORT... The Republic of Armenia's polished diamond output fell 35 percent to AMD 25 billion (about $74 million) in the first six months of 2007, continuing what has become a four year long decline in the industry.
Gagik Mkrtchian, head of the precious stones and jewelry department at the Armenian Ministry of Trade and Economic Development, explained the decrease is lead by weak demand for diamond jewelry from consumers in the United States.
Other factors affecting Armenia’s diamond decline, Mkrtchian explained, included the appreciation of the country’s currency, Armenian Drams, against the dollar, and a shortfall in anticipated deliveries of rough diamonds from Russia.
Armenia signed an agreement with Russia in 2001 whereby local companies would process up to 400,000 carats of Russian rough annually. The quota was subsequently raised to 450,000 carats for 2005 and 2006, but only a fraction of that actually was delivered in 2005 while no rough arrived in 2006, Armtown reported.
Armtown noted that Armenia’s polished diamond output, once a priority industry for the country, had declined from AMD 117 billion ($345 million) in 2004 to AMD 93 billion ($273 million) in 2006.
Mkrtchian said the bulk of the Armenia’s current rough supply was coming from Israel and Belgium.
Separately, Armenia’s National Statistical Service reported the country’s economy grew 11.2 percent in the first half of 2007.
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Tags:
Belgium, Consumers, Economy, Israel, Jewelry, Russia, United States
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