Big banks lend support to Dubai’s diamond trade ambitions

Three leading UAE banks are backing Dubai’s ambition to become a global diamond trading centre.

Emrates NBD, Mashreq and National Bank of Fujairah pledged to support the emirate’s growing diamond business at a conference in Dubai yesterday, with a multibillion dirham commitment to facilitate purchase and sale of diamonds.

Dubai is already a fast-growing diamond trading hub, based in the Dubai Multi Commodities Centre (DMCC), but there have been worries recently about financial backing for the global business following the withdrawal of some European banks.

“I’m very pleased to hear the three banks saying this,” said Peter Meeus, chairman of the Dubai Diamond Exchange. “After some worries, suddenly there is finance available for the industry in Dubai. It’s the only place in the world where new finance has been made available to the diamond business.”

George Abraham, general manager for strategic growth sectors at Emirates NBD, said: “As local banks we need to support the initiative of the Dubai government and the DMCC. Our perspective is long term. We are committed to the business.”

His stance was echoed by two other banks at the end of a two- day conference on the diamond business at DMCC’s Al Mas Tower.

“Mashreq has been financing gold and jewellery businesses in the UAE for years,” said Santosh Nair, vice president of large corporate business at Mashreq, said. “The rough diamond trade will be a steep learning curve. But we are committed to it.”

National Bank of Fujairah’s head of precious metals and diamonds, Davy Blommaert, said: ”As a UAE-based bank with a strong background in the bullion and jewellery sectors, NBF’s focus will remain on financing manufacturers and traders of rough and polished diamonds based in the country.”

NBF has jumped in to fill the space left vacant by Antwerp Diamond Bank, which closed its business in Dubai as part of the winding down of its global operations, which prompted some fears about the financial stability of the global diamond industry.

NBF is to occupy the premises in Al Mas Tower when Antwerp exits, and has employed some of the staff it laid off in the emirate.

“Leveraging the market and technical know-how of experts from ADB, we will focus on developing long-term partnerships with the top diamantaires [the industry term for diamond cutters and manufacturers] and be the bank of choice for their financial requirements,” added Mr Blommaert, a former Antwerp employee.

Two global banks at the conference, ABN Amro and Standard Chartered, were also supportive of Dubai’s strategy to become a trading hub between the producers of Africa and Russia, and the manufacturers of finished diamond products in India.

The emirate has pushed into third place in the global diamond business, with US$35 billion worth of trade per year, behind Antwerp and India, both on more than $50bn.

“Antwerp is an historical centre of the diamond business and will continue to be an important centre. But the winding down of the diamond bank there will have an effect on their global position,” Mr Meeus said.

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