The history of the diamond business in Israel is similar to that of the nation's economy

The history of the diamond business in Israel is similar to that of the nation's economy

The history of the diamond business in Israel is similar to that of the nation's economy

 

 

 

Israel commemorated its 74th anniversary of founding on May 5, 1948. Its narrative is extraordinary in every way: within three years after much was lost during the Nazi slaughter, a sovereign country and state for the Jewish people sprang out of the rubble. Over one-third of their total number.

The history of the diamond business in Israel is closely intertwined with that of the state, having developed from a few remote factories established by Dutch and Belgian immigrants to become one of the major global trade hubs and a pillar of the domestic economy. took place.

The Israel Diamond Exchange Complex, located in Ramat Gan, is the industry's headquarters and one of the biggest gem-trading hubs worldwide. The complex has approximately 1,000 businesses and is home to the sizable Israel Diamond Exchange as well as the Israel Precious Stones and Diamond Exchange.

What is now mostly open fields with towering buildings made of metal and glass was essentially uninhabited only a century ago, as were the nearby cities of Tel Aviv and Ramat Gan.

created in the chaos of World War II

In actuality, Israel's diamond industry existed prior to the state's establishment in 1948. When the Bezalel Academy of Arts was founded in Jerusalem in 1908, it was suggested that it serve as a breeding ground for the diamond-cutting and jewelry-making industries. However, the plan was shelved when the Ottoman Empire, which administered the area until 1917, declined to waive customs taxes on diamond imports for training and educational reasons.

However, once the British took over 25 years later, a group of Belgian Jews headed by Aharon Moritz moved to pre-state Israel with the goal of establishing a business that would polish diamonds. In 1936, Moritz succeeded in persuading the British Mandate authority to remove the tax levied on imported rough diamonds.

As it was, attempts to replicate the original polishing factory were fruitless. However, in 1937, the first fully formed diamond was produced in Tel Aviv when the British government approved the import of raw diamonds duty-free. This led to the development of many primitive polishing factories in the city. The plant was founded in Petah Tikva, a neighboring city. The Palestine Diamond Club, Tel Aviv's first commercial group, was founded in the same year.

A pivotal moment occurred in 1940 with the start of World War II and the German conquest of Holland and Belgium. Before the war, pre-state Israel saw a sharp rise in immigration, with many skilled diamond cutters from the two lowland nations coming to the country as worries about the future of the Jews in Europe rose.

The diamond cutting facilities in Amsterdam and Antwerp ceased operations when the Nazi flag was flown above. De Beers focused on the establishment of substitute production hubs, such as Palestine, Cuba, Mexico, and Brazil, which were now inhabited by diamond cutters who had left Europe, in an attempt to maintain the company's viability. By the conclusion of the war, polished diamond exports were valued at around $16 million, with an additional 4,000 people working in the business in Tel Aviv, Petah Tikva, and a new cutting facility in Netanya.

However, when peace returned to Europe, Antwerp's efforts to resurrect its moribund sector faced a shortage of raw diamonds as De Beers fulfilled a pledge to help them. Nevertheless, the hub of the diamond business persisted even if the number of workers in Tel Aviv, Petah Tikva, and Netanya's cutting facilities had more than halved.

Only 800 individuals were employed in this industry when the State of Israel was established in May 1948 because young people were conscripted into the army to protect the newly formed country. But when De Beers started selling raw diamonds on a regular basis to Israeli companies in 1950, the industry's long-term survival was assured.

The earliest contemporary diamond marketplace

In 1951, the Israel Diamond Exchange was officially founded in Tel Aviv, in leased space. The Israeli diamond industry saw tremendous expansion, which resulted in a sharp rise in participation in the new market. As a result, industry executives realized that a permanent trading facility was required to accommodate the expanding trade. Following some deliberation, a parcel of land in the neighboring city of Ramat Gan was chosen as the Israel Diamond Exchange's permanent location. The Shimshon Building, which offers over 15,000 square meters of office and commercial space, was opened for business in 1968. went.

The new corporate complex's design was groundbreaking in its conception. It was intended to be a safe and secure complex where all services would be offered within a single perimeter, enabling unrestricted mobility for diamond merchants. This included government officials, banks, shipping firms, insurance companies, restaurants, and diamond trading floors and exchange offices.

The current diamond trade hub of today was largely modeled after the Israel Diamond Exchange complex in Ramat Gan.

Connecting the buildings as more were built to the complex—Maccabi and Noam in the 1980s and Yahalom in the 1990s—Since walkways and bridges were constructed, the diamonds could travel between buildings without ever leaving the safe region.

The expansion of Israel's diamond sector is indicative of the nation's overall economic progress. With a GDP of under $5,000 per person, the State of Israel was a developing nation when it was established in 1948. With a per capita GDP of $43,500 as of right now, it is in the top 20 nations worldwide.

In 1948, Israel's entire diamond export earnings amounted to less than $10 million. Israel's rough and polished diamond exports were valued at $5.5 billion in 2021, according to government figures.