Bitcoin and the other “cryptocurrencies”, namely Ethereum and Litcoin- although there are 33 additional currencies arriving on the Internet – are a brand new phenomenon on the currency market.
Currently we are all in the so-called “fiat money” regime, namely any money declared by a government to be legal tender, which is a currency not backed by gold reserves – a currency which is always and anyway accepted by everyone.
Hence it is also fiat money, like the first “lire” of the Kingdom of Italy.
This means it is a State-issued currency that is not convertible by law to any equivalent value in gold or other hard currencies.
Fiat money is stable as it is controlled, almost on a daily basis, with the money demand from the economic system.
When there is an excess of money supply, we talk about inflation.
This is, indeed, the true meaning of the alltoowell-known concept of “inflation”, not the mere “price increase” which, at most, can be an indicator of excessive growth in money supply, not one of its causes.
Accepting the Dollar, the French or Swiss Franc, the Euro, the Ruble or any other currency (albeit, in fact, the situation would be somehow different for the Russian currency) is always mandatory by law.
Hence also seigniorage is mandatory, namely the act of legal magic with which each issuing bank decides that a small piece of paper is worth 100 nominal euro – although costing only 3 cents to the issuing bank for producing it.
The difference between the face value of money and the cost to produce it (plus fixed costs such as equipment, staff salaries and taxes) is, in fact, seigniorage.
The latter, however, should not be demonized, as done by some theorists who – by using a silly contemporary language dogma – are called “radicals”.
Reasonably, the possible alternative is the intrinsic value money, like the medieval coins – molten gold marked as shown on the coin front or back. Nevertheless the King often “reduced the value” of coins or melted gold and silver with non-monetary metals, such as copper (although the United States was to use it in the future) or even bronze.
Today we would say it was a form of “seigniorage” “with criminal relevance and implications”.
The primal scene – just to quote a concept by Sigmund Freud -stemmed from the 1971 “Smithsonian Agreement”.
It was the American agreement Nixon had wanted as from August 15, 1971, signed in the Smithsonian Museum of Washington. It was signed by what we would currently call the G7 and reestablished an international system of fixed exchange rates without the backing of gold. It certified the end of FED’s obligation to pay for gold up to the fixed rate of 35 US dollars per ounce.
It was the end of the gold-backed currency – the “fiat money” no longer pegged to intrinsic money – occurring after the Allies verifying that the American currency was severely overvalued.
The costs borne for the Vietnam War, the end of the Johnsonian cycle of Great Society and the crisis of US products on European markets, were all factors which led De Gaulle, at first, to ask – without further ado – the payment of the US debt in gold or in hard currencies. Later many other allies who were reluctant to put in place non-tariff barriers against US products followed suit.
To put it more brutally, Nixon shifted the burden of the US super-inflation onto his allies of the Bretton Woods Agreement, which Europeans were forced to pay since they had to buy highly overvalued dollars for their international trade.
As the US Treasury Secretary, John Connally, said at the time to his European colleagues: “The dollar is our currency but your problem”.
In other words, cryptocurrencies are the result of this long historical process.
The currency based on Nothing, the postmodern point of arrival point of the disembodied monetary instrument.
A currency that is believed to be good because everyone thinks so – a financial transposition of Andersen’s tale “The Emperor’s New Clothes”.
As you may remember, it is the tale about two weavers who promise an Emperor a new suit of clothes that they say is invisible to those who are unfit for their position, hopelessly stupid or incompetent – while in reality, they make no clothes at all, making everyone believe the clothes are invisible to them. When the Emperor parades before his subjects in his new “clothes”, no one, including his Ministers, dares to say they do not see any suit of clothes on him for fear that they will be seen as stupid. Finally, a child in the crowd, too young to understand the desirability of keeping up the pretense, blurts out that the Emperor “is not wearing anything at all” and the cry is taken up by others.
The same will happen to the contemporary monetary equilibrium, but it will certainly not be a child who will get bankers and the public at large to open their eyes.
Hence today banks create money, which is mandatory to consider valid, with a fiat -namely ex nihilo – from the Void of Value. Or from their debt or even from the State debt.
Just issue securities having another name.
Hence, what is currently money? It is what the Auctoritas decides to be so.
Or, to be precise, the money supply currently issued by the central banks or other banking institutions, which is not based on savers’ deposits or on debt repayment forecasts, but it is only the sign of a debt, the “promise of a settlement”which, however, is spent immediately.
And hence it is confirmed in its Value. The Value lies in theshift from a currency to another or from a currency to real goods or assets.
Obviously banks still earn interest on the money supply, regardless of its source.
Bitcoin, however, is not a currency like any other, guaranteed by internal law and interbank agreements.
The cryptocurrency is based on a mechanism like the one of online sales, namely the peer-to-peer one, which is gradually accepted by all those who now operate with Bitcoins.
Hence, while the final Bitcoin supply is defined – as always happens – our Internet currency is completely volatile.
Therefore it cannot certainly be a unit of account.
Hence Bitcoin varies- programmatically – as demand changes. In fact, last year its value increased by 47 times.
The reason is simple: it is a monetary supply that adapts to demand, but is also able to stop so as to create sufficiently long Bitcoin income and returns to attract average investors.
In January 2018,the cryptocurrency is worth approximately 900 dollars – a value that will probably increase when, in all likelihood, the Internet currency will be accepted by large commercial and distribution chains.
If it is a currency that influences markets by adapting to buyers’ requests (or artificially reducing supply in an instant), the only ones that can reap benefits are the Great States, the International Crime Organizations or the new networks of global Banks.
Never let them tell you that the small investor of Grand Rapids or Varese can determine the first “peer-to-peer” that, by repetition, triggers the chain off.
It is another fairy tale like the one of the movie Mary Poppins pointing to the magical growth of the penny deposited in a London bank, growing out of all proportion and turning into huge amounts of money.
The fairy tale is the expected automatic growth of funds denominated in Bitcoins, from 10 euro up to millions of millions, like the stars.
In fact, nothing is closer to the world of Andersen or the Brothers Grimm than some bad finance.
We can wonder whether the cryptocurrency is nothing more than a “Ponzi e-Scheme”.
You may recall the Ponzi Scheme or pyramid scheme, in which the high interest rates granted to capital providers -attracted precisely by the rates that are promised – are paid with new investors’ fresh capital.
In fact, what is striking is that the production of Bitcoins is sometimes artificially low because there are many people who want to buy them.
An issuing bank à la carte.
In fact, the many people who are waiting for buying Bitcoins hope that their value will increase, but only after they have managed to buy them.
A self-fulfilling prophecy.
A mechanism which is exactly the same as the Ponzi Scheme.
As the best US financial advisers say, do not follow the crowd.
Hence the Bitcoin is a “bubble”. A bubble probably bound to last, but still a bubble.
A bubble born in 2016. The primary year, while everybody makes reference to 2009, when the production of notes was no longer enough and the debt to be repaid was huge, while the West was entering its darkest crisis since the 1929one.
The trigger,i.e. the banking panic and the unaware laissez-faire approach of the US Presidency, were the same in both cases.
Two crises – the old and the new -broken out precisely in the United States, the burden of which was later shifted onto the rest of the West.
With a view to overcoming the first crisis, the huge costs borne for the Second World War were needed.The Rooseveltian stimulus had been to little avail.
The second crisis, much closer to us, which was triggered by the subprime crisis, has needed liquidity injections even greater than those needed during the 1929Great Depression – injections which have not ceased yet.
In the latter case, the exit from the crisis is ensured by the creation from nothing of the largest mass of money in human history, also through the Internet.
In fact, the Internet currencies have allowed to create exchange value, purely financial values that have strongly contributed to multiplying global liquidity in collaboration with standard currencies, which have been distributed indiscriminately to just any market – with helicopter money – by the US Governors and then by the ECB Governor, although certainly in much smaller proportions than his US counterparts.
On the other hand, when there is a liquidity crisis- a crisis caused by an excess of debt – every issuing bank prints money or rather creates money from debt securities. There is no other solution.
Contemporary Value arises from the mastery of a Name and from the artificial dissociation between this Name and a New Name.
Furthermore,in any case, the presence of cryptocurrencies only on the Internet and with a system along the lines of the peer-to-peer mechanism of normal online sales has allowed hackers’ systematic theft of 14% of all cryptocurrencies existing on the worldmarket.
A theft worth 1.2 billion US dollars, with revenues equal to at least 200 million US dollars.
In less than ten years, however, the technology generatingBitcoins will be vulnerable to cyber-attacks launched by quantum computers, which will become more widespread than they are today.
The attacks on virtual currencies have already cost governments and private companies owning them asmany as 113 billion dollars of turnover.
Nevertheless, who is currently inflating the Bitcoin value, which has more than doubled compared to January 2017 – a value that is now around 125%?
The main reason for this is China. Beijing is now the first market for the exchange of cryptocurrencies in the world.
As early as 2015 China alone traded 80% of Bitcoins.
Today, the top 4 among the 32 major exchange platforms of these new currencies mainly trade yuan.
One of these platforms has opened a mining station for “creating” Bitcoins – an operation which is highly energy-intensive and consuming – on the slopes of Tibet, where there is abundant low-cost energy.
Every time the yuan depreciates, the Bitcoin appreciates, because there are so many Chinese who pocket their capital to avoid government’s control and hence buy Bitcoins.
The yuan is depreciating and the capital flight from China is ongoing. The tool is often the conversion of the yuan masses into Bitcoins.
We may wonder whether the e-currency is used as a tool of “indirect war” against China.
Moreover, the current growth on the US and on some other European Stock Exchanges has occurred with credit money, borrowed at zero interest rate, which has been provided to major investors by central banks.
Another possible reason justifying the Bitcoin growth.
Virtual money may havealso been created to avoid the investors’ traditional rush to gold – the “tribal residue”, as Keynes called it – and hence not to increase the dollar value, currently maneuvered downward?
On January 15, one of the most active US-listed banks on the Bitcoin market ceased to convert cryptocurrencies into “traditional” currencies, but especially into dollars.
The beginning of the fall in the Bitcoin value, but the preservation of market liquidity, so as to prevent it from converging towards gold, in particular, or European hard currencies or, even worse, towards the Chinese or Russian financial markets.
Hence the Bitcoin is a pseudo-currency that serves to control the volatility and trends of global financial markets, as well as to keep it artificially high and avoid some currencies becoming “full” or sovereign like the Swiss Franc.
In fact, in 2018 a referendum will be held throughout the Helvetic Confederation on the so-called “full” or sovereign currency, i.e. on a Swiss Franc created by the national central bank and not by international banks.
“True Francs on our accounts”. Only the Swiss National Bank can create e-money, where necessary.
These are the goals of those who have proposed the referendum.
Let us hope for the best. Those who almost invented modern finance – the Swiss merchants of the Middle Ages, the link between Italian ports and large Central European markets -now realize the dangers of creating value from nothing, the Faustian (and darkly malicious) mechanism currently governing the magical and alchemical transformation of banks’ and States’ debt into credit for individuals.
Let us hope that the financial world will come to its senses, just in time.
EEU: An Irrelevant Anachronism or a Growing Digital Enterprise Dynamo?
A commonwealth of interests
The search for a stable Eurasia depended on the effectiveness of a durable system for the post Soviet space which could easily descend into an arc of instability if was not properly managed. Moscow had to be careful not to view these ex Soviet countries as its natural hinterland to be taken for granted and to upgrade its relations with each of them to preserve a communality of interests that had eluded it in Ukraine. The world of the command economy centred on Moscow would be made over on an entirely new basis that reflected the fast moving 21st century digital economy. Where common standards and freedom of movement of people and capital was meant to create a climate of openness and facilitate cross border business not to seal off Eurasia from the outside world. The fragile nature of post Soviet identities meant that a sense of commonwealth and common citizenship rooted in an overarching Eurasian identity would be more appealing to a growing entrepreneurial class disillusioned with the results of narrow ethno- nationalism as a ruling idea. The danger was that the more the Eurasian Union grew in stature it would have to navigate roadblocks deliberately placed there by powerful nationalist interests who perceived it as threat to their power base. And by stoking tensions with Russia periodically these former Soviet states could remind the outside world that they were not tame satellites of Moscow or artificial constructs but were free to decide their own destinies.
The path to some kind of durable Eurasian concept was obstructed by the reluctance of many Eurasian states to give up on the idea that eventually find a place in the west. The Eurasian union might be a useful stopgap while they waited to the privileged world of the west where they felt they ultimately belonged. Even though the chances were slim that it would ever happen. The Russian view of the Eurasian Union was that it would be a modernizing force which would have the express aim of bringing the region closer to the world and transforming it into a forward thinking technological giant. It would not be a repeat of the “Soviet experiment” which was a parallel universe closed to outsiders with information tightly controlled. And with the official version vastly at variance with the grim reality. Its core vision this time around was to effectively connect the region to the outside world and be at the forefront of new innovation. It would not depart from international standards and go off on its own tangent or conduct its affairs with guarded secrecy. But happily embrace new ideas and fresh thinking. Russia’s objectives were to circumvent parochial state leaderships and local bureaucracies and create a global brand that would capture the imagination of high net worth investors and provide a real alternative to pro western orthodoxy. With first class transport, logistics and a digital economy that would be the envy of the world, it would be first and foremost technocratic and meritocratic and not so much ideological in nature.
The Russian leadership concentrated on achieving maximum consensus in decision making and adopting policy positions where the weaker states would not be unfairly disadvantaged. While Russia would be providing the bulk of the digital infrastructure and at its own expense it would be considered common property of the Eurasian economic union in many ways. Russia’s contribution was based on a more generous model than its Chinese partner which took the form of loans that could result in forfeiture of assets if loan payments were not met in time.
Thus Russian prime minister Mihail Mishustin recommended at a meeting of the inter Government commission implementing a “digital project” across the whole Eurasian union. This would provide a “specialist information system” in the sphere of “migrant labour” that would better serve the needs of business and the migrant communities. These measures would seek to gradually phase out and replace the patchwork, confusing system of regulations with a common framework. So for example in future the EEU would receive powers that would promote standardization. The Eurasian commission adopted a new technology based system of labelling products that “would apply in future in relation to new categories of labelled products.” The prime ministers of the EEU states approved a document that would “establish a time limit by which member states would be notified of the intention to introduce labelling on their territory.” And would give them a “period of nine months to outlaw unlabelled products.” The new system should eventually be incorporated fully at the national level so that business could “escape unnecessary burdens” caused by “different systems of control.” and gradually filter out bureaucratic anomalies.
The priority was to create a level playing field so that the EEU was not perceived as just an exclusive club for Government connected state companies. But that it would also create conditions for small and medium enterprises to thrive and expand and ease substantially the costs of doing business. As well as reversing the favouritism traditionally shown to large companies by making the ability of SME’s to operate in an environment that was transparent and equitable more concrete. For example the prime ministers of the EEU states agreed to a “unified ecosystem of digital transport corridors”. The total cost of the scheme would be around 10 billion roubles. The cost divided between the union and the member states. It would provide a “service for the access of electronic route maps, international transport charging rates” as well as electronic protocols that would give updated information on interior ministry regulations etc. This unified system was especially useful to SME sector who were often reliant on “outside platforms” which were often “not connected to each other” and ” the absence of coordination added to their logistical costs.”
Similarly the five member states of the EEU have agreed to form a common financial market by 2025. A key role in this is played by financial technology which will be deployed to make financial services “more accessible, cost favourable and safer”. Private and business customers can expect “financial services of higher quality and greater choice to be available”. And with such a hi tech financial monitoring tool at the authorities disposal “credit and financial institutions will have to reveal the origin of their capital”. An important element was the Application Programming interface which gave the programme the capacity to conduct biometric identification and to connect IT systems together so “they can exchange information between themselves.” Also a pilot project was launched which the AFT system together with 13 Russian banks were undertaking. “The aim of it is to improve automated online credit lending for small and medium businesses.” And create a level playing field. This was another example of how the Eurasian Union was preparing the ground for a greater role for the more dynamic and innovative SME sector in anticipation for a shift from a resource based economic model to a more diverse demand and consumption one.
Capitalism and the Fabrication of Food Insecurity
Human security can be depicted as the notion through which the widespread and cross-cutting challenges to the survival, livelihood and dignity of individuals can be identified and protected. In simpler words, folks are protected against threats and situations that deem to violate their vital human rights. Thus, with human security, the protection and empowerment of people is promoted. With that said, under the umbrella of human security, food security holds immense significance; as, it is responsible for sustaining human life and health. In addition to that, it also stipulates individuals on the required energy for progression, resulting in the evolution of state institutions and its functioning. Henceforth, food security has a direct co-relation with the development of a state.
Notwithstanding, the lack of access to sufficient quality of affordable food results in food insecurity, which can be depicted in several states and communities across the globe. However, contrary to popular belief,this food insecurity is not a subsequent of scarcity; in fact, the annual production of food surpasses the benchmark of sustaining one and a half times more food for the world’s entire population. In reality, the scarcity narrative was produced by corporate food regimes to serve their interests through capitalism. Since, it can result in the incorporation of price increase and generation of maximum profit, indicating how the agricultural sector is influenced by the interests of elite companies. In fact, the top eight firms in agriculture hold 80% of the sector’s market share, and these particular institutions dictate the conditions and rules for our food system, while effectively setting the price of grain for the world subsequent to their benefits. As a result, several regions of the world experience food insecurity, which essentially tarnishes their road to progression.
Through capitalism, food has transformed from a necessity into a commodity, solely for the purpose of profiting from its high demand. This denotes the horrors of capitalism; because, profits are given priority over human needs. Due to this lust for profit, corporate food regimes initiated the “Green Revolution” in the 1950s and 1960s. On the surface level, the movement consisted of the development of new disease-resistant strains of food crops, primarily wheat and rice. The incentive was to increase crop yield in the developing world, through countries such as India and Mexico. Nevertheless, beneath the surface, this movement led to an increase in food insecurity and served the interests of the elite. The green revolution led to the introduction of subsistence farming systems, in the form of new technology. However, in order to adapt to this system, farmers required cash to buy seeds, fertilizers and equipment, along with the continuous supply of cash to maintain them. Meaning, the farmers could not rely on eating their own produce and selling the surplus. Instead, crops had to be traded with agricultural corporations, in order to continue to earn a living through farming. Thus, the green revolution did not lead to improving small-scale farmer productivity. In fact, it monopolized the agricultural sector and consolidated the profit in the hands of specific transnational corporations. The companies in turn influenced the agricultural market to their benefit, leading to food insecurity.
Furthermore, food insecurity is a result of the systematic failure of capitalism. One of the ways to attain maximum wealth for agricultural corporations and their shareholders, is through over production. Hence, these companies set a fix price for the farmers cost. In this manner, farmers cannot produce less crops despite declines in agricultural markets. As a result, crops are over produced and their market price declines. In order to cover the fixed costs, the farmers have to carry out more production, which puts them in perpetual debt. In addition, with over production, goods pile up unsold, workers are laid off, demand drops and prices of products increases, resulting in lack of access for poor people.
A country fighting against the influence of the corporate food regime is India; as, Indian farmers in Punjab and Haryana have carried out mass protests recently. Reason being that the Indian Parliament has passed three agriculture acts—Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, Farmers (Empowerment and Protection) Agreement of Price Assurance, Farm Services Act, 2020, and the Essential Commodities (Amendment) Act, 2020. Since Modi’s regime favors the interests of the elites and the corporate regimes, these laws have made farmers of India vulnerable to exploitation and the prevalence of food insecurity. Firstly, the laws aim to remove the agricultural produce market committee (APMC), which is the area that regulates the notified agricultural produce and livestock. Through the APMC, traders were provided with licenses and a minimum support price for crops was set. As a result, corporations could not dominate the agricultural sector; however, the new laws challenge that very concept. Even though the Indian government has argued the changes will give farmers additional freedom, the farmers claim that the new legislation shall eliminate the safeguards set to shield them against corporate takeovers and exploitation. Therefore, the monopolization of corporate regimes in the Indian food system shall further devastate the livelihoods of vulnerable communities, and the food insecurity will prevail.
As a solution to food insecurity arising from capitalism, a reappearance in the pre-capitalistic reality should occur, where food is not bought and sold to the highest bidder. Instead, food is sold outside exclusive markets as a basic right of all citizens of a state. This system can be regarded as the system of communal responsibility. The success of which can be traced back to the era of empires, where individuals did not experience food insecurity despite the rise and fall of empires. Proving how, co-operative production and fair distribution of food is possible. Hence, in conclusion, food insecurity is a fabrication of capitalism and the interests of corporations; where, wealth is saturated in the elite class. Accordingly, the solution is to return to the pre-capitalist reality and focus on communal responsibility.
China’s Emerging Diamond Industry
Since the 1980s, China’s economy has been on the rise. With a prosperous manufacturing industry, China has a growing middle class and an ever-increasing demand for luxury goods. Compared to Russia, China does not have large diamond reserves. However, the country makes up for its lack of resources by gaining access to diamond reserves in Africa and producing affordable synthetic diamonds.
The Underdevelopment of China’s Diamond Industry
China’s diamond industry is underdeveloped due to lack of resources in diamond mines domestically and overseas. According to a report by Frost & Sullivan in 2014, China is still developing its overseas diamond market, and only a few companies have access to diamond mines.
According to the F&S, Chow Tai Fook, a Hong Kong-based jewelry chain is the only Chinese company that has obtained the DTC (The Diamond Trading Company) qualification of distributors. As a subsidiary company of De Beers, the DTC sorts, values and sells about 35% of the world’s rough diamonds. As a renowned company in the industry, Chow Tai Fook has its diamond polishing factories to source rough diamonds from mining companies directly. It also has supply agreements with Rio Tinto, Alrosa and De Beers. Chow Tai Fook has four diamond cutting and polishing factories—two in South Africa, one in Botswana, and another in China. However, for other renowned Chinese companies on diamond processing, such as Henan Yalong, or CR Gems, they cannot purchase rough diamonds directly from the market, so they mainly produce synthetic diamonds. Even if they are to process rough diamonds, they can only purchase raw materials from secondary markets, where the price of rough diamonds is high, leading to even higher production costs.
By contrast, India, the world’s largest diamond processor, has more than 60 companies with the DTC qualification of distributors. India also has access to a number of essential diamond mines. For a long time, India has relied on suppliers from Russia and Africa and diamond trading centres such as Antwerp, Tel Aviv and Dubai for rough diamonds. Most of the diamonds produced in the world are shipped to India for cutting and grinding and then go into the global retail market. In this way, India dominates the diamond processing industry.
China’s diamond processing industry and African mines
By securing deals with companies and governments that control diamond mines in Africa, China is breaking India’s monopoly on diamond processing through the Belt and Road Initiative. This had caused China’s diamond exports to increase by 72% by 2014, generating revenue of US$8.9 billion. Countries and regions that signed the Belt and Road Initiative in central and southern Africa, such as South Africa, Gambia, Zaire, Botswana, Zimbabwe and their surrounding areas are the most famous rough diamond sources and producing sites of the world. In recent years, Chinese company Anjin Investments, a joint venture between Anhui Foreign Economic Construction Co. Ltd., and Matt Bronze Enterprises of the Zimbabwe Defense Ministry and the Zimbabwe Defense Forces, has been negotiating with the Zimbabwe government on mining resources. President Emmerson Mnangagwa of Zimbabwe has recently allocated fresh diamond mining claims to Anjin Investments in Chiadzwa in Manicaland province, four years after the company was evicted from the mineral-rich area alongside other miners on allegations of under-declaring proceed in 2016. Meanwhile, Russian company Alrosa also signed a number of agreements with Zimbabwe Consolidated Diamond Company (ZCDC) to establish a joint venture for Zimbabwe’s primary diamond deposits. It will be interesting to see whether China and Russia will cooperate in Zimbabwe for diamond mining in the future.
To summarize, combining Chinese craftsmanship and rough diamonds of high quality is bound to be a massive opportunity for the global market in the future. Besides, it is also crucial for China to strengthen workers’ vocational skills to improve the diamond processing industry’s overall efficiency and production level. As China begins to further invest in the BRI project, Chinese companies may find more opportunities in Africa in the future.
China’s synthetic diamond industry
According to the F&S report, the global market for rough diamonds will lead to a shortage of 248 million carats by 2050. Customers from China and India have significantly contributed to this number. By advancing its technology in producing synthetic diamonds, China finds another way to develop its diamond industry.
In recent years, China’s synthetic diamond industry has been expanding along with the increasing global demand for China’s synthetic diamonds. According to a report by Leadleo on China’s synthetic diamond industry, there were 8,278 diamond equipment, materials, micro-powder, composite sheet, diamond tools and diamond products companies in China’s diamond industry as of the end of 2018. The top five leading enterprises in the industry occupy about 80% of the market share and have high market concentration. In terms of the industry’s geographical distribution, large leading synthetic diamond enterprises are mainly located in the Henan Province due to the local government’s policy preferences. By contrast, small diamond manufacturing enterprises concentrate in the Anhui Province. On a technical level, the low-end sectors of China’s synthetic diamond industry have developed their international market competency by improving their products’ quality to reach international standards. By contrast, Chinese enterprises that manufacture high-end diamonds with special functions still have a long way to go. There is a significant gap between them and leading global manufacturers such as the UK’s Element Six, one of the world’s best manufacturers for high-end synthetic diamonds. Therefore, many artificial diamond companies in China are currently working on enhancing their technology, striving for breakthroughs to meet global customers’ various demands, and obtaining more significant profit margins.
To conclude, China’s diamond industry is emerging. With the development of the synthetic diamond industry and more access to African mines, China is hoping to make more breakthroughs in the diamond industry in the near future.
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