Demand for luxury products could help the Northwest Territories through an overall slump in the mining industry.
The price of gold is at a four-year low, which is bad news for prospective gold mines in the North. But not all areas of the economy are suffering.
Kevin Todd, a director in the territorial government's Industry, Tourism and Investment department, says the economy of the Northwest Territories is based on luxury goods.
"If you think about what we actually produce, diamonds are a luxury good, aurora tourism is a luxury good, fur is a luxury good," Todd says.
Economic analysts say as the United States economy strengthens, so will demand for luxury goods such as diamond rings.
Patrick Evans, the chief executive officer of Mountain Province Diamonds, says diamonds are in a category of their own.
"There is no shortage whatsoever of gold and silver. The picture is different with diamonds. There is no stockpile of diamonds. Almost all the diamonds are sold into the market," Evans says.
Evans says diamond prices have been helped by growing demand in China and India combined with a limited supply.
Mountain Province Diamonds and De Beers Canada hope to start mining at Gahcho Kué, N.W.T., in 2016.
Evans says the project 280 kilometres northeast of Yellowknife, contains 55 million carats of diamonds ranging in size from tiny fragments to up to 200 carats.
"Two-hundred carats would look like a small apple in size," Evans says.
Competition from synthetic diamonds could threaten the industry since human-made stones can appear identical and in some case are chemically identical to the real thing.
De Beers and a group of gemology labs have developed a device to detect fake stones and the industry has worked hard to maintain the allure of natural diamonds.
In 1940, only 10 per cent of brides in the United States received a diamond engagement ring. That number increased to 79 per cent by 2013.