WEAK DEMAND FROM U.S. FURTHER ERODES ARMENIA POLISHED DIAMOND SECTOR
By Avi Krawitz
Diamonds.net, NY
July 26 2007
RAPAPORT… The Republic of Armenia’s polished diamond output fell
35 percent to AMD 25 billion (about $74 million) in the first six
months of 2007, continuing what has become a four year long decline
in the industry.
Gagik Mkrtchian, head of the precious stones and jewelry department
at the Armenian Ministry of Trade and Economic Development, explained
the decrease is lead by weak demand for diamond jewelry from consumers
in the United States.
Other factors affecting Armenia’s diamond decline, Mkrtchian explained,
included the appreciation of the country’s currency, Armenian Drams,
against the dollar, and a shortfall in anticipated deliveries of
rough diamonds from Russia.
Armenia signed an agreement with Russia in 2001 whereby local companies
would process up to 400,000 carats of Russian rough annually. The
quota was subsequently raised to 450,000 carats for 2005 and 2006,
but only a fraction of that actually was delivered in 2005 while no
rough arrived in 2006, Armtown reported.
Armtown noted that Armenia’s polished diamond output, once a priority
industry for the country, had declined from AMD 117 billion ($345
million) in 2004 to AMD 93 billion ($273 million) in 2006.
Mkrtchian said the bulk of the Armenia’s current rough supply was
coming from Israel and Belgium.
Separately, Armenia’s National Statistical Service reported the
country’s economy grew 11.2 percent in the first half of 2007.