Israel Hub of the Diamond World

Tradition & Innovation

Shmuel Schnitzer- President IDE Moti Besser – Managing Director IDE

Annual export of rough & polished - $ 10 Billion

Total annual turnover - $28 Billion

Polished export destinations:

U.S.A 38% Hong Kong 30%

Total credit to the industry - $1.5 Billion

Number of employees in Israel - 20,000

Number of employees, worldwide - 55,000

Number of license holders – 2,000

Diamonds constitute 20% of Israel’s total industrial export

• 100,000 sq. - Internal & External Security

• 2 trade halls for polished & rough

• Modern cutting & polishing center

• 1,400 Diamond companies,2,200 offices,330,000 visitors

• 5 Diamond Banks

• Shipping Companies

• Tax Depot

• Government office - Diamond Controller (the Regulator)

• Leading mining companies

• Post Office

• Synagogue, clinic, gym, restaurants, pensioner’s club ,dentist, barber

• Training courses for new members:

:Gemology, Ethics, Marketing, Sales, Security.

• Excellence in management courses.

• Enrichment classes - Mediation/ Negotiation,

online sales.

• Contribution to the community - Hospitals, Children at Risk ,Foundation for handicapped children.

• Welfare Funds: for supporting those in need.

*Sister company : Israel Diamond Exchange Enterprises is directly responsible for building and infrastructure administration and maintenance

0

10'000

20'000

30'000

40'000

50'000

60'000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

5'509 6'333

6'709 6'610

7'076

9'553

5'824

8'892 10'700

8'400 9'161 9'324

Israel Industrial Export Israel Diamond Export

-500

500

1500

2500

3500

4500

5500

6500

7500

Trend line

(8% per year)

-15%

-13%

+20%

Average annual growth over decade

U.S - 2.6% Europe - 1.0% Israel - 4.0%

Global financial

crisis 2008/9

Tech stocks fall And September 11

Asian financial crisis

The Gulf War

Global Industry crisis

7 4

8

38

30

13

Switzerland

England

Belgium

USA

Hong Kong

Other

Rough Import

($1,000)

Polished Export

($1,000) Year

56 70 1940

9,000 8,800 1950

49,200 58,000 1960

154,000 202,000 1970

995,000 1,409,000 1980

2,168,000 2,783,000 1990

3,869,000 5,322,000 2000

4,413,000 7,200,000 2011

3,832,000 5,563,000 2012

3,990,531 6,222,208 2013

4,022,618 6,263,398 2014

$0

$500

$1'000

$1'500

$2'000

$2'500

$3'000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

0.0

5.0

10.0

15.0

20.0

25.0

2008 2009 2010 2011 2012 2013 2014

19.0

12.4

18.0

21.7

19.5

22.5 23.90

52% 52% 49% 45% 43% 42% 42% 39% 40%

20% 20% 20% 25% 29% 29% 28% 35% 32%

17% 17% 17% 18% 17% 17% 18% 17% 16%

11% 11% 13% 13% 12% 12% 12% 9% 12%

2006 2007 2008 2009 2010 2011 2012 2013 2014

All Others

Belgium

India

Israel

Government License Diamond Controller

Diamond Bourse Member Requirements

Ethical Code

AML for Diamond Sector

Rules for Synthetics

The Business Leverage We Offer Our Members

Cooperation among the world’s diamond bourses to promote the

business of exchange members – acting together as an engine

of worldwide diamond trade.

Business promotion at minimum cost – No expenses on booths, advertising, couriers or insurance

• Israel Diamond Week at the DDC, November 2014

• International Diamond Week in Israel , February 2015 • International Rough Diamond Week , April 2015 • Presidents’ meeting, June 2015 • International Diamond Week in Israel , September 2015

Modern Manufacturing Center

Manufacturing Wing; Polishing Wheels, Sawing, Laser Cutting, Polariscope (pressure machine)

Technological Services; Sarine, (Galaxy) ,OGI, Color machine

Gemological Services Professional Training Courses

$0

$500

$1'000

$1'500

$2'000

$2'500

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

$1'470 $1'496 $1'596

$1'782

$2'045 $2'084 $2'136 $2'285

$1'615 $1'626 $1'628 $1'575 $1'444 $1'400

1עמודה

13.7% 11.0%

10.4% 9.8%

10.5% 11.5%

10.6%

12.4% 14.10%

9.60%

7.40%

9.60% 8.60%

7.8%

Finance Intensity

= Debt

(Export + Import)

45% 41%

27% 23%

28%

24% 22% 2.2 2.4

3.7

4.3

3.6

4.2 4.5

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

9/2008 2009 2010 2011 2012 2013 2014

Level of Financing Financing Months Polished Export

Debt

Debt .

Polished Export

Erik Jens: CEO of ABN AMRO International Diamond & Jewelry Group

• The Israeli Diamond Industry is one of the world’s largest and most diverse trading centers in the world, enjoying unique infrastructure both advanced and convenient (all under one roof) , as well as close working relationship with the government.

• Israeli diamantaires have immense knowhow , passed on through generations, in manufacturing, development of new cuts, trading and technology

• Israel is a major source of innovation - Israeli technological developments are later adopted worldwide: lasers, Ogi, Sarin, auto polishing, bruting and table opening machines. Israelis are innovators, quick to respond to changes

• Israelis constantly re-invent themselves: from smalls to fancies to large, from local based manufacturing - to more cost effective manufacturing overseas, from only manufacturing - to trading, from passive to active marketing.

• The Industry - stable and responsible - gradual, measured growth, conservative regarding financial risks.

• The main reason for the existence of a diamond center in Israel is that many of the largest diamond companies belong to Israelis who prefer to run their businesses locally.

• The continued prosperity of the Israeli Diamond Industry owes much to its ability to implement the necessary changes in the managerial and organizational culture.