China Urged to Develop Jewelry Designs

RAPAPORT... Total trade volume on the Shanghai Diamond Exchange (SDE) in the first quarter of 2010 reached a record high of $559 million, with a 91.1 percent increase year on year, according to recent statistics from the Diamond Administration of China (DAC). Total imports and exports increased by 100.7 percent to $524 million, while net imports increased 127.5 percent to $261 million, most of which came from Belgium, India, Israel and South Africa. The DAC attributed the sharp increases to rising domestic demand, business from the trade shows and stricter enforcement of laws in the aftermath of a major smuggling ring bust early in 2010. Membership in SDE also increased to 253, as more trade members rushed to obtain licenses to import diamonds. The exchange is the only authorized channel for importing diamonds into China under the favorable tax policy.

A Force in Jewelry Design

Speaking in Shenzhen on May 14 at the inauguration of a new trade association called China Jewelry Culture and Creative Industry Association, CIBJO President Gaetano Cavalieri stated “China has firmly established itself as a major consumer market and manufacturing center. It now is time to assert itself as a force in jewelry design, and put its stamp on the industry, much in the same way that my colleagues in Italy have done for so long. I am confident that the new association will play a role in the injection of Chinese design and artistic perception into the international jewelry arena.”

Cavalieri recognized China’s development into a significant force in the jewelry industry, emphasizing that it now has a responsibility to others in the global jewelry sector. “It is most important to remember that we are an international market, and that what happens here in China impacts throughout the global chain of distribution, just as what happens elsewhere will have an effect on the Chinese business,” he said. “In our industry, it is extremely likely that any item of jewelry represents the combined efforts of literally thousands of people living in different parts of the world. Every single individual who was in some way responsible for the manufacture of an item of jewelry — from the miner to the refinery worker, to the diamond cutter and the jewelry designer, the manufacturer and the retailer — plays a critical role in the process.”

World Expo 2010

Shanghai World Expo 2010 opened on May 1 with 189 participating countries.
Shanghai was a commercial and shopping center in China even before the republic was founded 60 years ago but this is the first time it has hosted a world expo of such magnitude and prestige. During the six months of the expo, an estimated 70 million visitors are expected to visit Shanghai, 95 percent of them Chinese nationals, which is expected to bring a huge boost to domestic consumption, including jewelry.

More than 50,000 people a day are expected to visit the Belgian Pavilion at the Shanghai World Expo 2010 every day, a very popular site that is distributing free chocolate and hosting a diamond prize giveaway. The Diamond Exhibition Corner will display modern jewelry designs and illustrate the history of diamonds. In addition, Antwerp’s 550-year diamond heritage will be illustrated with ten of the most prestigious antique diamond jewels from the Diamond Museum of the Province of Antwerp, together with the world-famous European Community Championship (ECC) diamond tennis trophy, a tennis racket made of 3.2 pounds of gold and 1,600 diamonds with a total weight of 150 carats, all perfect “Cut in Antwerp” gems.

In the long term, the expo is not only a gesture of doors being opened wider, but also a huge economic propeller, especially for Shanghai. The city has gone through a major overhaul in preparation for hosting the expo. Since 2005, Shanghai has built eight new Metro lines and extended existing lines. By the end of April 2010, Shanghai’s Metro and light rail length increased to 260 miles, more than four times that of 2005. Hundreds of miles of roads have been built or improved. The high-speed trains, which can reach over 186 miles per hour, also connect to other major cities, enabling people to travel between different cities within the same day for business and leisure. The city has spent billions of dollars on infrastructure, which has greatly improved the business environment and reinforced Shanghai’s position as the commercial and financial center of the country. The Chinese government’s slogan for the pre-expo work was “Keeping in mind the next 60 years’ development while preparing for the six months’ Exposition.” The event is expected to leave a legacy to the nation and the city of Shanghai for decades to come.

The Marketplace

• The retail market was very busy during the May Day holiday and quieted slightly afterward, which resulted in a slight slowdown in wholesale activity. Overall, the market is very stable.
• Demand is good for 0.30-carat to 1.10-carat, D-J, VVS-SI, GIA-certified and preferably EX stones.
• Demand is stable for parcel goods in 0.20-carat to 0.30-carat, H-J, VS-SI.
• Demand is good for World Expo–themed jewelry, decorations and gold and silver bars.