ARMENIAN DIAMOND-CUTTING COMPANIES REPORT DECLINE

Armenpress
Nov 28 2006

YEREVAN, NOVEMBER 28, ARMENPRESS: A senior official of the Armenian
trade and development ministry who is in charge of diamond cutting
and jewelry businesses, said last week the sector suffered a tangible
setback in January -September of 2006 with a 20 percent output decline
and nearly 18 percent decline in sale volumes.

Gagik Mkrtchian, head of the department, said almost eight percent
of workers (300 people) were laid off. He said 42 percent of rough
diamonds were brought from Belgium, 54. 6 percent from Israel and the
rest from other countries. Mr. Mkrtchian attributed the decline to
decreased demand fro diamond and gold items at the world markets saying
consumers are buying more essential goods. Another reason, he said,
that should be blamed for the decline is the continued appreciation of
the Armenian dram against major hard currencies, which makes exports
an unprofitable business, as it increases the primary cost of goods.

He said lack of competent managers in Armenian diamond-cutting and gold
factories was yet another reason accounting for the decline. Mkrtchian
said Armenian prime minister Margarian is leaving soon for Moscow
where he will negotiate with Russians ways to establish cooperation
between diamond cutting companies of the two countries.

As good news Mr. Mkrtchian reported a five percent growth in the
mining industry, which he said was due to fresh investments in
the sector. He said a 20 percent increase is expected in 2008 when
Armenian is supposed to produce 4 percent of all molybdenum in the
world. Armenia now produces about 4,000 tons of molybdenum annually,
which make 2 percent of the world production.

From: Emil Lazarian | Ararat NewsPress