Israel’s diamond regulator has granted temporary concessions to promote shipments to and from countries affected by the coronavirus, after exports slumped in February.
Dealers can now spend 90 days inspecting polished goods from certain virus-hit countries without paying import duty, instead of the usual 30 days, diamond controller Ophir Gore said in a letter to Israel Diamond Exchange members last week. The arrangement applies to transactions with China, Hong Kong, Macau, Japan, Taiwan, South Korea, Singapore and Italy.
The inspection period enables companies to decide whether to buy stones that have arrived from overseas, and return unwanted items without incurring a 0.1% import levy. It applies to goods worth $50,000 or more.
“We recognize the impact of the virus on business interactions with these countries, and especially on the diamantaire community,” Gore explained. The measures are in place until May 5 to help dealers that trade with those markets, he added.
Israel’s global polished-diamond exports dropped 73% last month, according to data from the nation’s Ministry of Economy and Industry. Shipments to Hong Kong accounted for just 6% of the total, compared with a typical figure of 20% to 30%.
Amid the challenges, the government has also increased the cap on polished diamonds dealers may transport with them on an airplane to the affected countries. Traders that deposit goods for checking and receive them at the airport gate can take up to $1.5 million of merchandise, versus an earlier limit of $1 million. Transportation of goods that only go through an inspection procedure at the diamond controller’s office, rather than also at the airport, is limited to $700,000, compared with $200,000 previously.
Meanwhile, companies that ship rough or polished diamonds to those markets now have a year and three months to bring the goods back without paying import tax. The limit was previously a year.
“In light of the spread of the coronavirus and its large impact on diamond exports to the East, I presented several requests to the diamond controller, Ophir Gore,” wrote Israel Diamond Exchange president Yoram Dvash in a Facebook post last week. “I’m happy that after swift work by the senior team, the controller has approved the concessions we requested and that they are effective immediately.”
Image: A display of four phases of diamond polishing — from rough to finished — during the 2016 edition of International Diamond Week in Israel. (Shutterstock)