On the Topic of Diamond Exports: Either You Are Lying or the Government Is, Armen Minasian to Babken Tunyan

Political scientist Armen Minasian has addressed the comments made by MP Babken Tunyan from the "My Step" parliamentary faction regarding the re-export of diamonds from Armenia, previously discussed by former Armenian Ambassador to the Holy See Mikael Minasian.

Minasian's post reads:

“MP Babken Tunyan attempted to counter former Ambassador Mikael Minasian yesterday, advising thoughtful individuals to draw their own conclusions based on the so-called real facts he presented. Perhaps the hope was that those thinking people would scrutinize the facts and accept what he presented as authoritative.

However, verifying the facts revealed that the MP either does not understand the statistics or is intentionally deceiving. Babken, referencing some data from the UN, claimed that 'in 2016, $106.3 million worth of diamonds were exported from Armenia, and in 2019, $54.3 million worth.' Apparently, the MP is unaware that the RA NSS publishes reports under the titles 'Key Indicators of Industrial Organizations According to the Economic Activities Classification for January-December 2016' and 'Production of Main Types of Products in Industrial Organizations in January-December 2016.' Consequently, studying these reports clarifies that the volume of industrial products recorded under the two-digit classification code 32 was as follows:

• 2016 – 36.4 billion AMD
• 2017 – 51.2 billion AMD
• 2018 – 53.1 billion AMD
• 2019 – 49.5 billion AMD

Already, it becomes evident that the volumes of the produced goods have increased. However, it is possible that among the various products categorized under code 32, other items have increased while the volume of diamonds has decreased. To verify this, we delve into the five-digit classification data and find that the volume produced under the code '32.12.1 Diamond Processing' was:

• 2016 – 30.9 billion AMD
• 2017 – 41.5 billion AMD
• 2018 – 41.3 billion AMD
• 2019 – 43.2 billion AMD

To validate this data using another method, we compare the volumes produced in physical terms. It turns out that in Armenia, diamonds were processed as follows:

• 2016 – 125,431 carats
• 2017 – 204,102 carats
• 2018 – 229,396 carats
• 2019 – 239,220 carats

To determine whether Babken is indeed correct, we check the volumes of sold products. The results are as follows:

• 2016 – 30.9 billion AMD, of which 24.4 billion was in the CIS, and 6.5 billion in other countries.
• 2017 – 41.9 billion AMD, of which 37.2 billion was in the CIS, and 4.7 billion in other countries.
• 2018 – 43.0 billion AMD, of which 35.4 billion was in the CIS, and 5.6 billion in other countries.
• 2019 – 42.9 billion AMD, of which 37.8 billion was in the CIS, and 2.0 billion in other countries.

If you perform a mathematical operation with these official figures—dividing the indicated values by the annual average exchange rate of the dollar—you will find that the data Babken presented is far from reality.

Regarding the current year, during the first quarter of 2020, the volume of products released in Armenia under the two-digit classification was 23.3 billion AMD. While our NSS does not publish five-digit classification data for quarterly figures, based on the experience of previous years, it can be confidently said that 85-90% of the produced goods are diamonds, meaning approximately 20 billion AMD.

Additionally, the volumes of sales and exports are comparable. The most remarkable statistic that Babken will likely find shocking: in the first quarter of 2020, 118,476 carats of diamonds were processed in Armenia (compared to 67,900 carats during the same period last year). This means that within three months of 2020, nearly as much was processed as during the entire year of 2016. Yet, this is not significant. What is significant is that according to the NSS, 522 people are employed in diamond processing in Armenia (in a previous post, I increased this figure to 400 according to data from 1000plus).

Even if we assume that 522 is the correct number, all of them involved in diamond processing, then even if they worked during holidays, each would need to process 2.5 carats per day (118,476 carats divided by the 91 days of the January-March period, then divided by 522 employees). If you find a single diamond artisan capable of processing 2.5 carats daily for 90 consecutive days, let me know so we can marvel at it (it should be noted that the average figure ranges depending on the quality and size of the stone, reaching about 1.4 carats per day).

Babken, as you see, as a thoughtful person, I have familiarized myself with the facts and drawn conclusions. Now you decide: either you are lying or the government is, represented by the NSS.”