While outside the luxurious Shangrila hotel - located close to the offices of prime minister Recep Tayyip Erdogan – police forces were readying themselves to disperse the demonstrations of that evening, a very different scenario was played out in the hotel’s conference hall, at the 2013 Presidents’ Meeting of the World Federation of Diamond Bourses.
The events’ hosts, lead by Dr. Ibrahim Tourhan, the chairman and general manager of the Istanbul Gold and Diamond Exchange, lectured on the measures and steps taken by the Turkish government to extract the country from the severe economic crisis of the 1990ies, and on the policies that led to an open, stable and transparent economy that operates in full compliance with the guidelines of the European Community.
Some 25 presidents out of the 28 bourses that hold WFDB membership participated in this year’s Presidents’ Meeting. Apologies were received from the Diamond Dealers Club of New York, the Hong Kong Diamond Federation and the Antwerpsche Diamantkring. The International Diamond Manufacturers Association (IDMA) canceled its participation only days before the meeting, due to a very low number of registrants.
The meeting welcomed a number of dignitaries and guests. Susan Shabangu, minister of mines and energy of the Republic of South Africa, the chairman of the Kimberley Process (KP), Ambassador Welile Nhlapo, representatives of the governments of Zimbabwe and Botswana. Dr. Gaetano Cavalieri, president of CIBJO – the World Jewellery Confederation, has since long become a regular guest of the international congresses and meetings of the diamond sector. At the Istanbul meeting, CIBJO and the WFDB signed an agreement to intensify the cooperation between the two organizations.
Representatives of the diamond bourses of Canada and South Korea were present as observers. The (renewed) candidacy of these bourses for WFDB membership will most probably be tyabled at the 36th World Diamond Congress in Antwerp, June 15-18, 2014.
WFDB president Ernest Blom thanked the participating presidents and their delegations for their presence, in spite the media reports and the situation in the city.
Blom spoke at length about the proposed reforms and other parallel initiatives that are being developed with regard to the KP. “We call upon all the institutions involved to become part of the solution and not of the problem,” he stated.
At the PM’s opening session, Blom introduced the event’s chief topic: taxation, emphasizing the importance to the economies fo the various diamond production and consuming centers. The chairman of Chamber of Commerce of Turkey, Ibrahim Kugler, explained the assistance the chamber extends to those who wish to open diamond trading companies I Turkey. He emphasized that foreigners can establish fully foreign-owned trading firms, without any need for local partners.
As has become tradition, industry analyst Chaim Even Zohar (CEZ)and his strategic partner Pranay Narvekar, gave a presentation, this time on taxes. The ananlysts painted out that a third of the amount paid for a diamond jewel by a consumer consists of taxes. That, Even Zohar said. Is considerably more than the rate paid by rough producers, manufacturers and others [in the pipeline]. At the same time, he noted, the diamonds manufacturers and traders find themselves in an odd position: they pay taxes but are not rally profitable. A ’true’ analysis shows that while the diamond firms may have the illusion that they are making a profit and earning money, their bottom lines show that their profits remain razor thin. In the past 33 years [this is apparently how long CEZ has been studying the industry], the industry’s financial growth has benefited only the rough producers and the banks – and no-one else, he said.
Courtesy of the Israel Diamond Institute.
