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Diamond trade between Antwerp and Singapore is booming

Singapore is a growing market for Antwerp diamonds according to the Antwerp World Diamond Centre, the institution that represents the interests of the Belgian diamond sector. AWDC predicts a 3% rise in turnover in the Singapore jewellery market. Good news for the diamond sector because over a quarter of the jewellery being sold contains diamonds.

 

From intermediaries to consumers

The number of luxury brands that has opened flagship stores in Singapore has risen exponentially over the past few years. Singapore used to be a geographic link between Antwerp diamond companies and the Indian market. But since 2009, Antwerp exports big volumes of rough diamond to Singapore itself. The total value of the export amounts to 283 million dollars over the past six years.

Also cut diamonds from Antwerp are quite popular with a total export value of 315 million dollars. 42% of which was exported in 2014. A significant sign that trade between Antwerp and Singapore is booming.

Gold versus diamond

Singapore, as well as India and Malaysia, used to be focused on gold. “Gold used to be the ideal investment.” says Ari Epstein, CEO of AWDC. Gold’s prevalent status seems to be diminishing. The liberalization of the market has increased the demand for new luxury items. “Affluent Singaporeans like designer clothes and exclusive diamond jewellery.” he continues. “According to predictions, the Singaporean middle class will grow in the coming years. This could have a positive effect on the diamond market.”

Diamond financing

Besides a growing market for diamond, Singapore is also a financial hub were many international banks are present. Although very few of them are specialized in diamond financing. “Diamond financing is an absolute niche market. It’s something only 5% of all financial institutions have knowledge of.” according to Epstein. “Since Singapore is changing from a transit market to a consumer market, diamond financing offers new opportunities for banks in the area.”

Diamond traders usually open a credit line at a bank and use it for trading. “The bank lends money that is used to buy rough diamonds.” Epstein says. “The bank is, in fact, pre-financing the cutting of the diamond. When the cut diamond is sold, the trader can reimburse the bank.”

Invest in diamond

Would you like to profit from the rising demand for diamonds on the Asian market? Ask our BAUNAT advisors about investment possibilities. Since three generations, we’ve been helping investors maximize their return on diamond investments.