The Comrades Are Capitalists; USSR Dumping Diamonds on World Market to Undercut Israel’s Industry

The Soviet Union is resorting to the old fashioned capitalist device of price-cutting and dumping to undercut Israel on the world diamond market, Moshe Schnitzer, president of the Israel Diamond Exchange, charged here today.

He said the Russians, who entered the international market for polished diamonds only two or three years ago–previously they produced only rough gems–were making use of a highly efficient, modern and largely automated diamond polishing industry that is beginning to cut into Israel’s share of the market.

Polished diamonds have long been one of Israel’s chief exports, earning millions of dollars in foreign currency annually. Schnitzer told reporters that in recent months, some $10 million worth of diamond orders from Israel by Asian dealers were cancelled because the Russians were offering the finished stones at nearly half the current world market price. He said the Russians, had the advantage of direct access to uncut diamonds while Israel depends on an international syndicate of diamond producing countries for its supply.

In addition to the inroads being made by the Russians, Israel’s diamond industry is suffering from the world-wide economic recession, Schnitzer said. He said that Israeli polishing plants that specialized in large stones for the past few years are presently processing only stones of one carat or less. Nevertheless, Schnitzer noted, Israel’s diamond industry can still absorb workers while in Belgium, Israel’s chief competitor in the field, about half of the diamond workers art on half time.

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