“The Israeli government has pledged $284 million (NIS 1 billion) to guarantee bank loans to diamond companies in an effort to ease the trade’s severe credit difficulties.
A lack of credit is stifling growth, especially among the smaller firms that constitute about 70% of the Israeli trade, according to a special committee set up to investigate the sector’s challenges.
<…> The diamond trade is an important segment of the Israeli economy, representing about 13% of total exports, and employing about 9,500 people, according to the report. However, the 2008 global financial crash led to a 27% slump in Israel’s polished-diamond exports between that year and 2016, with the Chinese market slump in 2015 also denting demand.” says Rapaport.
“We have decided to allocate another billion shekels over the next five years to the diamond sector through credit guarantees,” Cohen told an audience at the International Diamond Week in Israel last week.
In addition, the committee suggested the government provide money for the bourse’s newly launched innovation laboratory, put cash into bringing more diamond buyers to Israel, support efforts to develop e-commerce opportunities, and contribute to other projects to boost the industry.
“The committee identified the main hurdles in small businesses’ activities in the sector, and its recommendations offer a comprehensive response to its needs,” Kaufman-Pass said.
“Implementing the committee’s conclusions, alongside other steps, is essential, considering the crisis the sector has been through,” Cohen added. “Their purpose is to provide new tools to help deal with challenges in the trade and to ease regulation, thereby growing both production and exports.”