Of Challenges and Opportunities

On the inaugural day, Ahmed Bin Sulayem, executive chairman, DMCC, set the tone for DDC by highlighting the exceptional growth story of Diamond as one of the world’s leading diamond trading centre, the challenges the industry is staring at, the opportunities which can be explored. “ In just 15 years, Dubai has become the third biggest diamond trading centre in the world with an appetite to achieve more. This didn’t happen by accident. It happened because we designed an environment which is safe, business-friendly that is conveniently linked with producing and consuming markets. Our success is largely built on a mind-set that the industry drives the government, not the government drives the industry. This has long been our competitive edge,” explains Sulayem. As per the data available with DDE, the diamond trade in Dubai has grown to $26 billion in 2016 from $300 million in 2002. Only Antwerp and Mumbai are ahead of Dubai in the list of leading diamond trading centres in the world.
However, Sulayem took the opportunity to express his viewpoints and concerns on the behalf of the industry on the impact of Gulf Cooperation Council’s (GCC) unified agreement to implement VAT on this region. “With the introduction of VAT next year which is one of the lowest in the world leaves our member companies and industries genuinely concerned. Among the gold and diamond businesses in Dubai, there is a sincere feeling of uncertainty. We are already aware of the development that two gold refineries are planning to move to Hong Kong. Such news sends a very negative message. The tax authority needs to consider this with great caution how to move forward if it wants to avoid exodus of business from UAE,” cautions Sulayem.

In addition, he tried to draw the attention of the trade to the growth in the global middle class and the strength of emerging economies – which obviously translate into millions of new customers. Having said that, he feels that the retail narrative is going through a massive transformation and the transformation is primarily led by the people born after 1985. “37% of millennials claim to distrust big business and brands.They like to shop, but they shop more on price than on the lineage of the retailers. Moreover, 50% prefer to buy products that support causes or charities.When they go online to shop or do research, they value other consumers’ opinions and reviews over what they find published on a company’s website.It’s a different world. What do we as an industry have to change to better appeal to this demographic? But with an estimated spending power of $65 billion in the United States alone, millennials are a critical market segment that our industry is struggling to connect with,” he alludes the industry to the huge opportunities which are yet to leveraged.