RAPAPORT… During the second day at the 34th World Diamond Congress underway in Moscow, the industry’s movers and shakers discussed how to address and prioritize issues such as Zimbabwe and the credit burden on the industry. Zimbabwe is to be the big topic discussed later this week during the Kimberley Process mini-summit in St. Petersburg, however many have expressed their opinions on the issue here.
“We must quickly include Zimbabwe in the diamond pipeline, or it will be a catastrophe,” said Moti Ganz, the president of International Diamond Manufacturers Association.
Ernest Bloom said that diamantaires are finding themselves pawns in a much larger game underway between governments and NGOs.
Zimbabwe’s ambassador to Russia gave a passionate speech at the Congress, calling upon participants to put aside “political” agendas and clear his country for selling its rough.
The outcome of the St. Petersburg meeting, following this Congress and hosted by the World Diamond Council (WDC), is difficult to predict, yet Congress participants agreed that closing that meeting without a solution would hurt the people of Zimbabwe and diamantaires worldwide.
“Things can be corrected, we shouldn’t let this crisis develop, because it’s dangerous to the industry,” said Shmuel Schnitzer.
WDC president Eli Izhakoff expressed hope that some companies in Zimbabwe, which comply with Kimberley Process regulations, could be cleared during the mini-summit. He estimated chances of a broader deal being reached in St. Petersburg at 50 percent and with news today of NGO researcher Farai Maguwu being granted bail, the rate of success improves.
As for the liquidity issues facing manufacturers, participants discussed ways that would lift the burden from manufacturers and polished dealers. Schnitzer said, “The banks are shrinking the credit lines more and more.”
Alex Popov, the president of Moscow Diamond Bourse, added that part of the liquidity problem is “the outrageous position of buyers in the U.S. who squeeze the suppliers with 180 days terms of payments for the goods.”