Editor’s Note
This article explores the remarkable paradox of Israel’s diamond industry, which dominates global trade without mining a single stone. It examines how expertise in cutting, trading, and distribution has positioned the country as a central hub in this glittering market.
The global diamond industry is often seen as a domain of natural wonders, sparkling gems, and ancient traditions, yet Israel has managed to carve out an astonishingly prominent role in this glittering world despite the fact that it does not possess a single diamond mine. It hosts the largest diamond exchange globally, with Tel Aviv’s Diamond Exchange District serving as the nucleus of a multi-billion-dollar trade that stretches across continents. The Israeli diamond business is a fascinating anomaly, one that has puzzled many: how can a nation without any diamond mines dominate the market, processing and trading an estimated $23 billion in rough diamonds annually?
The answer lies not in mining, but in an unparalleled mastery of trading, cutting, and distributing diamonds that has been built over decades. Israel’s diamond business is deeply intertwined with the country’s commercial acumen and its geopolitical manoeuvring, and its success can be traced to strategic, and at times controversial, decisions involving Africa’s vast, yet under-exploited, mineral wealth.
It is no small irony that Israel ranks among the top five diamond exporters in the world, despite the fact that it does not mine a single diamond. This paradox has raised eyebrows for years, particularly when one considers that Israel’s diamond industry is based in a small, highly concentrated district within Tel Aviv, where trade volumes soar into the billions. The secret behind Israel’s dominance in the diamond world isn’t buried in its soil, but rather in the finely honed abilities of its merchants, traders, and cutters, who have made the nation a world leader in diamond processing and distribution.
Israeli companies, notably those based in Tel Aviv, possess an exceptional reputation for their cutting-edge technology and skilled labour force that can cut, polish, and resell rough diamonds with unmatched precision and efficiency. Over the decades, Israel’s diamond exchanges have evolved into bustling international hubs, attracting not only local dealers but also players from around the world. Thanks to their competitive pricing and exceptional workmanship, Israeli traders can command a significant share of the global diamond market.
However, despite this impressive infrastructure, the key to understanding Israel’s vast diamond industry is its reliance on sourcing raw diamonds from the most resource-rich continent on Earth—Africa.
While Israel’s reputation as a diamond powerhouse is undeniable, its dominance is largely due to the raw materials it imports from Africa. The Israeli diamond industry thrives by sourcing rough diamonds from countries rich in deposits, yet lacking in the infrastructure or know-how to process the gems. Nations like South Africa, Botswana, and Angola, rich in diamonds, have long been the foundation of Israel’s flourishing gem trade. But the most lucrative source, and the one that has propelled Israel’s diamond industry to new heights, has been the Democratic Republic of Congo (DRC).
Here enters the figure of Dan Gertler, an Israeli billionaire who epitomizes the unorthodox nature of Israel’s diamond industry. Gertler, the grandson of the former president of the Israel Diamond Exchange Moshe Schnitzer, embarked on his diamond ventures in the DRC in 1997, securing exclusive mining rights and quickly building a significant presence in the country’s mining sector. It is Gertler’s dealings in the DRC, however, that have drawn attention not only for their business success but also for their deep political and ethical complexities.
Dan Gertler’s diamond empire began in earnest with his 1997 acquisition of a diamond mine in the DRC, and it wasn’t long before he solidified his position as one of the most influential and powerful diamond tycoons in the world. His rise was not merely based on business acumen, but also on his ability to navigate the treacherous political terrain of one of Africa’s most volatile countries. The assassination of DRC President Laurent-Desire Kabila in 2001 temporarily interrupted Gertler’s plans, but it would not prove to be an obstacle for long.
By 2002, Gertler struck an accord with Laurent’s son, Joseph Kabila, who succeeded his father as president. In return for his support, Gertler gained access to the DRC’s vast resources, including diamonds, copper, and cobalt, and expanded his business interests. His efforts didn’t end there; Gertler’s mining operations are notorious for their exploitation of local labor, including child labour in the cobalt mines, which have drawn significant criticism from human rights groups.
In 2017, the Trump administration imposed sanctions on Gertler, citing allegations of corruption in his dealings with the DRC’s state-run mining company. These allegations suggested that Gertler’s activities had deprived the country of substantial revenue, fuelling suspicions that the wealth generated from Congo’s natural resources was not benefiting the Congolese people but rather enriching a small elite, including foreign tycoons like Gertler.
Israel’s diamond trade has been deeply interconnected with some of the most contentious global issues, from its relationship with Africa’s troubled economies to its dealings with questionable political regimes. Despite the murky origins of many of the diamonds that flow through Tel Aviv, the Israeli diamond exchange has continued to thrive, largely due to its unparalleled ability to process and distribute gems efficiently.
