The diamond trade is working on a system to raise money for category marketing, aiming to broaden the sources of funding following Alrosa’s exit from the Natural Diamond Council (NDC).
Three major industry organizations discussed the plan at the recent Dubai Diamond Conference and committed to pursuing it, said David Kellie, CEO of the NDC, in an interview with Rapaport News on Monday.
The objective is to raise $65 million per year for the NDC in addition to its current budget of $35 million, Kellie explained. This would give the marketing group the annual budget of $100 million that it had before Russia’s largest diamond miner left in February 2022 when the Ukraine war broke out.
At present, the NDC — which promotes natural diamonds to consumers on the industry’s behalf — receives funding from De Beers and other mining companies as well as from a handful of trade partners.
Import levy
The Antwerp World Diamond Centre (AWDC), the Dubai Multi Commodities Centre (DMCC) and India’s Gem & Jewellery Export Promotion Council (GJEPC) came together to devise the proposal, which is not final yet.
Those bodies would likely collect a fraction of rough imports from their members, possibly building on existing mechanisms for raising funds. For example, the GJEPC already takes a 0.02% cut of members’ rough imports for generic marketing.
One source with knowledge of the matter said the groups were discussing a 0.05% levy on imports. Kellie declined to comment on this but said that contributions had to be “fair” and “affordable.”
The parties will also have to discuss how to represent the trade on the NDC board of directors so they have a say in where the money goes.
“The industry is challenged at the moment, but a fraction of a percent from a lot of people makes a lot more sense than a few organizations putting in a lot more money,” Kellie noted. “It also makes the NDC much more representative of the industry rather than a few players.”
On to Antwerp
The three groups will now discuss the plan with their respective stakeholders. They will reconvene at the Facets 2024 conference in Antwerp next week to assess progress. While there is no fixed deadline, the matter is “urgent,” and Kellie would like to see the system start in the first quarter of 2025.
The joint project also signals the industry’s willingness to cooperate on a vital purpose, the executive continued.
“Up until now, Dubai and Antwerp have seen themselves as competitors,” he said. “But I think what’s really interesting is how that they’re coming together on this and recognizing it as an industry challenge and that the more we work together on some things, the better everyone’s going to be.”
Image: A rough and a polished diamond from the NDC’s “Real. Rare. Responsible” advertising campaign. (Natural Diamond Council)
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