Dubai, the Gulf’s gold trading centre, is on track to become the world’s second largest diamond trade hub within the next year, the executive chairman of the Dubai Multi Commodities Centre said Monday.
The Gulf emirate is currently the world’s fourth largest diamond trader but is rapidly moving up the rankings, Ahmed Bin Sulayem told Arabian Business.
''I do see that growing further, I see it reaching the top two in the next year or so,'' he said on the sidelines of the 5thArabian Business Forum in Dubai.
“I believe you are going to see bigger trade coming through Dubai and maybe the diamond financing will add even more stability to the diamond business in Dubai.”
The speed of the city’s growth is dependent on the willingness of regional banks to offer credit to diamond traders, he added. Local lenders have a lack of industry expertise, when compared to those in more established hubs such as New York and Mumbai.
Dubai traded $25.3bn of rough and polished diamonds in the first half of 2011, up from $35bn in 2010. DMCC, which provides the infrastructure for the city’s commodities trade, ranks Dubai as the world's fourth largest diamond trading hub, behind Antwerp, New York and Mumbai.
The GCC’s tense diplomatic relationship with Israel has been mooted as a barrier to the growth of Dubai’s diamond trade, as Israeli jewellers play a prominent role in the wholesale industry. But Sulayem said the majority of the Gulf emirate’s diamond trade was driven by other markets.
"Israel now is not as relevant as it used to be. Israel does not own any mines, all the mines are in Australia, Africa, Russia and Canada," he said.
"The mines are not in Israel; the productions are not from Israel, that's the trading centre. They are competing as they are, they are a very strong competitor but as far as Dubai is concerned, our biggest trading partners is India, and Europe and Africa.”