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Israeli Labs Vie Internationally

Feb 12, 1999 11:28 AM   By Tzipora Templeman
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By Tzipora Templeman

The study of stones simply excites Israelis. Perhaps it is the fundamentals of Israeli history and culture that bring many to delve into the lore of all rocks. The study of the precious stones of the Holy Temple, the inherent power of stones as taught in the mysticism of the Kabbalah, and Israeli youth trekking throughout the Far East and India to discover the hidden meaning of the minerals are just a few examples of those who have joined the esoteric world of gemstones and diamonds.

The study of gemology as it's known today was not always as well received. Looking back 25 years, author and precious stones expert Menahem Sevedermish recalls the reaction he received when he opened the first gemological school and lab in Israel. "People were against knowing too much about stones. The industry leaders felt that there is a halo surrounding the diamond which must be preserved at all costs."

The demand for certification and in-depth gemological knowledge emerged in the mid-1970s. Not only was gemology legitimate to study and relate to, but intrinsically necessary to sell the stone. Once you know the quality of the stone, you can determine the diamond's price. Israeli dealers were once able to rely on their individual perceptions of the stone and its probable grade; when their customers subsequently certified the stones, they often received better grades than the Israelis expected. With the certificate becoming inseparable from the stone, the Israelis placed themselves in a position of knowledge and power.

Getting Known

Local Israeli labs were first established in the 1970s. According to Israeli law, anyone opening a lab must receive a permit from the Diamond Controller's office.

The problem facing Israeli labs is that, while their technical expertise and credibility is undoubted, their names are not internationally recognized. Subsequently, their certificates do not command a premium price for the stone.

"Buyers in every country want certificates known to their retailers," explains GIA graduate gemologist Eli Dori, who also runs a successful gemological school in Ramat Gan. "It is not about whether the Israeli labs are good or not. Israeli certificates have a problem because they are not well known abroad. For them to become more than what they are today would require a major advertising campaign over the course of years, which is impossible considering the size of these labs and their respective budgets."

There is reason to understand why the local labs are needed. As one of the world's top diamond exporters, Israel may appear to be inefficient when it ships stones abroad for grading just to have them return to Israel for re-exporting. This involves the shipping expense, and precious business days lost with the stones shipped so far away. "Looking at the figures alone, we should have had a large laboratory in Israel to serve the industry as a whole," says Efraim Raviv, managing director of the Israel Diamond Institute (IDI). "Perhaps had we invested our efforts and money into establishing this lab years ago, we would not have to strain ourselves with sending our diamonds overseas."

The solution is for these labs to find an outlet abroad to give credence to the local certificate. The Gemological Institute of Precious Stones (GIPS) certificate had a limited distribution abroad. Sevedermish, founder of the lab, agreed with the European Gemological Laboratory (EGL) that the GIPS certificate could be exchanged for an EGL certificate for a nominal fee. When business at GIPS slowed down two years ago as a result of the recession affecting the Israel gem industry, Sevedermish and Avi Meirom bought GIPS and resurrected it under the international name European Gemological Center (EGC). Sevedermish explains that they could no longer rely on the quality of the certificate alone. "We needed an internationally recognized name." They agreed with the EGL that the EGC would also issue EGL supervised certificates for diamonds, and their own EGC certificates for precious stones and appraisals.

Under the Umbrella

The IDI Gemological Laboratory (formerly GILI), is a subsidiary of the Israel Diamond Institute (IDI), an umbrella organization including the government, labor union, and diamond organizations, serving the Israeli diamond industry. The IDI Gemological Laboratory was established in the late 1970's as the only official laboratory in Israel. The lab provides its services exclusively for the diamond industry, and is closed to the general public. The lab is recognized and appreciated for its strict standards and as such has a very devoted clientele demanding the IDI certificate. Foreign buyers often insist on receiving an IDI certificate, relying on its reputable high standards, to assure the people back home of the quality of their buys.

"Naturally, if the buyer does not insist on receiving a certificate, you do not go to all the trouble and expense to procure one. The diamantaires realize, though, that the demand for certificates is increasing, especially if you want to receive a premium price for your stone," notes Raviv. "We have to try to push our laboratory as much as possible from the inside, while on the other hand, we must try and look for a partner who can cooperate with our high standards."

The IDI does not have branches overseas, which limits its services. In the past it has been approached by other labs, but feared that the union would compromise the lab's strict standard. It does maintain good relations with some of the leading international laboratories.

Understanding its need for international exposure, the lab changed its name a few years ago from GILI to IDI, feeling that it would gain more exposure if the name were more obviously related to the Institute.

A new lab, International Gemological Center (IGC), which was opened six months ago by an international investment company, also realizes the need for international exposure and for servicing the various markets, reports IGC manager Yehuda Yacar, a former manager and head gemologist at GIPS. It has filed for registration in New York, Geneva, and the Far East.

An International Name

The European Gemological Laboratory's (EGL) grand opening in Israel in 1993 proved to be a turning point for the local market as it was the first international lab to set up shop in Israel. Says manager and head gemologist Guy D. Benhamou, "Before EGL was founded here, there was no local lab of international reputation or name. The European Gemological Laboratory is a world-renowned name, in existence for over 25 years. Having the stones certified in Israel speeds up the process of preparing the diamonds for marketing abroad. The Israelis appreciate the service we provide them."

EGL is a dynamic organization which believes in establishing labs where needed. "The key is in our providing efficient customer service, together with reliable and professional gemological work, wherever necessary," Benhamou concludes.

Certificates take on an added importance when times are more difficult. Though people grow more money-conscious, they also realize that without the certificate, it is more difficult to sell the stones. The labs are doing well and the Israelis continue to expand their horizons in gemology and gemological research. Along with its regular grading and certification services, the IGC offers gemological courses restricted to people affiliated with the industry. The new European Gemological College (EGC) is pondering possible summer programs for overseas students to study the industry first hand, apprenticeships for gemological students inside the lab, and leadership training programs. All this is besides an extensive curriculum. While Israel is vying for an international foothold, it retains its own ancient attachment to the rocks of the earth.
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Tags: GIA, Government, IDI, India, Israel, Israel Diamond Institute, Laboratories, Labs
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