The market of polished diamonds has found itself to be to its ears in debt and needs liquidity. To solve this problem, Martin Rapaport, the creator of the famous Rapaport Diamond Price list, plans to start an online diamond exchange, offering cash-based transactions. The businessman plans to launch a new financial instrument already in the coming months. But the Russian experts doubt if it will be in demand.

The Rapaport Diamond Exchange will host bids and offers for different sizes and grades. The Bloomberg reports that the diamond industry has as much as billion of bank debt and at least twice that amount in credit between market participants. Martin Rapaport said that “We need to drive and encourage a cash market for diamonds as soon as possible because the credit market for diamonds is going to hell in a bucket.” The businessman promised to launch the online diamond exchange early next year.

The Russian experts have taken this initiative critically. Firstly, the diamond market is very traditional and its participants will most likely take the new instrument with distrust, says the president of the Board of experts and appraisers of gem stones and antiques, Alexander Gagarin:
 “Diamond exchanges are rather closed structures, very few people get there just from outside because everything is based there on trust. When such a multistaging with intermediaries begins, I do not even know how people will react! After all, it is a far-back conservative system.”

It is hard to predict whether buyers and potential sellers will go to such an exchange, agrees a leading expert for the managing company Finam Management, Dmitry Baranov. He sees many other "buts" in Rapaport’s idea:
“It is not quite clear how prices will be set and how fair the price for diamonds will be. The next question: the rules in respect of work with cash are very strict in the U.S., therefore, it is not quite clear how the issues of safety and mutual settlements will be solved? And another question immediately arises: how the origin of money will be checked?”
And, finally, the main problem is that everyone lacks for cash now, not only the market of jewels, the expert reminds. Nevertheless, it is impossible to work with diamonds as before: cash is needed because the credit market for diamonds is coming to naught, this is roughly what Martin Rapaport said.

Israel's exports of polished diamonds will likely shrink to billion to .5 billion this year, compared with billion last year, according to Shmuel Mordechai, diamond controller at the Industry, Trade and Labor Ministry.
Israel's diamond industry is the world's third-largest, after Belgium and India.

Exports of rough diamonds from Antwerp plunged 36 percent to 9 million in October compared with the same period of the last year.