By Atom Markarian
Israel is emerging as one of the main trading partners of Armenia due to the growing presence of its diamond dealers in the Armenian diamond-processing industry that has expanded considerably in recent years. Barely noticeable in the ex-Soviet state’s external trade balance as recently as two years ago, Israel accounted for the single largest share of Armenia’s imports and was the second most important destination of its exports in the first nine months of this year. The overall bilateral trade shot up to almost $245 million or slightly less than the volume of Armenia’s commercial exchange with Russia.
Trade between the United State and Armenia, by comparison, stood at approximately $130 million during the same period, government data show.
Gem diamonds, one of Armenia’s main export items, account for the bulk of the Israeli-Armenian exchange. Israel has already replaced Belgium, a traditional center of diamond business in the world, as the prime buyer of Armenian-made precious stones.
A handful of Israeli businessmen, notably billionaire Lev Leviev, have set up shop in the country in the last few years, bringing in rough diamonds, having them refined and polished in the country and then selling them in international markets.
Leviev’s Shoghakn plant, located 15 kilometers north of Yerevan, is now one of Armenia’s biggest diamond firms, employing about a thousand people. The other Israeli dealers operate on a smaller scale.
Armenia’s diamond output totaled $226 million from January through September or 37 percent higher than during the same period last year. Practically all of that is sold abroad. The exports are due to reach $500 million by 2006 under a three-year plan to support the industry that was approved by the government last week.