Until now Latin American buyers had to travel to US or Europe to buy polished diamonds for catering to the USD 8 billion Latin American diamond jewelry market. But recent inauguration of The World Jewelry Hub (WJH), Latin America’s first dedicated diamond, colored gemstone and jewelry trading center is going to change that and catapult the Panama Diamond Industry.
WJH was inaugurated last month in Panama in the presence of country’s president, industry leaders and business members from all around the world. The inauguration ceremony took place in the first phase of USD 200 million WJH complex. WJH incorporates Panama Diamond Exchange (PDE) – first and only Latin American member of the World Federation of Diamond Bourses (WFDB). PDE is a constituent of the global network comprised of 29 diamond bourses operating in 21 countries.
Judy Meana, VP of PDE in an interview remarked “I feel that attendees left the event with a realization that the World Jewelry Hub, together with the PDE, is the primary location for suppliers of diamond, gemstones and jewelry to connect with key buyers from South America, Central America, Mexico and the Caribbean.”
The WJH consists of two phases. The first phase which was completed at the end of 2014 serves as headquarters of the PDE and provides office space for 69 companies and service providers. Phase two, which includes a state-of-the-art multi-story tower with office space for hundreds of companies, will begin construction soon and will be ready for occupancy by the end of 2017.
Among the participating countries, India was highly supportive of the initiative. For the first time, polished diamonds from Surat, world’s largest diamond polishing center, will be directly flown to the Panama Diamond Exchange. Around fifteen Indian diamond and jewelry firms including like Rosy Blue, Kiran Gems, Diarough (NV) have already purchased office space at WJH and PDE. Companies from other countries like Israel, Belgium, United States, Italy and Latin America have also setup their offices in WJH making it the largest concentration of diamond and jewelry specialists in all of American continent.
Panama’s government has made PDE and WJH more attractive to the world by exempting them from the regulations and taxation normally imposed on business in Panama. The Parliament of Panama approved a legislation that allows diamond, gemstone and jewelry to be brought in to the WJH without import duties for further processing and re-exporting. Companies that establish business in the free zone are largely exempt from paying tax on profits.
There is also tax exemption on every activity involving transfer of personal property, real property, purchase of construction equipment and materials, raw materials, machinery, tools, accessories, inputs and every good or service required for its operations, carried out by companies established in the free zone. Tax is to be paid only if the merchandise is released in the local market.
WJH is perfectly positioned to take advantage of Latin American market whose luxury consumption is growing at 14%. Annual demand for jewelry and gemstones in Latin America will reach USD 10 billion by 2015.
PDE VP recently said that Panama Diamond Exchange is the most important development to happen in the Latin American jewelry sector in many decades. She further added that their plan is to transform PDE into one of the world’s most important diamond bourses, and Panama into one of the world’s key trading centers.