2023-05-20 11:46:00
If the United States announced an embargo on Russian rough diamonds, this is not (yet) the case of the European Union. The stakes are high: Russia is the world’s largest producer of rough diamonds, the country’s third-largest export product, after oil and gas. Putin’s homeland would have exported nearly $5 billion worth of precious stones in 2021. Enough to partly finance his war in Ukraine. In short, the situation is becoming difficult to hold on the European side. This Friday, Charles Michel, the President of the European Council, thus announced in Hiroshima that the European Union would “limit the trade in Russian diamonds” as part of the sanctions against the invasion of Ukraine. “Russian diamonds are not forever”he quipped in front of the press, confirming an upcoming European measure after the embargo already announced earlier in the day by the United Kingdom on these precious stones.
Belgium would be directly concerned by this measure since it is one of the main importers of Russian diamonds. Nearly 85% of the rough stones traded worldwide pass through Antwerp. Before the war in Ukraine, almost a third of the diamonds for the Antwerp trade came from Russia. “We are waiting for the final declaration of the G7 to be able to really reactexplains Tom Neys, spokesperson for the Antwerp World Diamond Center (AWDC). We are already doing everything possible to limit the arrival of Russian diamonds in our country. But a strict embargo would kill Antwerp. It would be over. We would become a European market, but more global. The diamond dealers would leave for Dubai or Mumbai in India”.
“The key is in the United States, the world’s largest diamond buying market”
Tom Neys reminds us: the Belgian diamond sector is not formally opposed to an embargo on Russian gems, but it must be accompanied by the establishment of a technological system to be able to trace precious stones from Russia. “The current system of declaration of origin of stones does not work”. The American embargo would thus be easily circumvented via countries like India where Russian diamonds are cut and sent with the “Made in India” label to the United States. “Seven out of ten diamonds sold in the United States are in fact Russian stonessays Mr. Neys. Everyone has to play by the same rules, which would be the case with technological tracing, otherwise this embargo will not work. The technological solution is ready. Now it’s up to the politicians to make the choice. To adopt it or not”. For the spokesperson, the key is in the United States, the world’s largest market for buying diamonds. “What are they going to decide? It’s a mystery”. The stakes are also financial: in the event of technological tracing, the Russian stones sold last year in the USA under a false label would no longer be worth anything. The debates are likely to be lively this weekend.
G7 leaders will be able to present their case directly to Indian Prime Minister Narendra Modi, whose country has close military ties with Russia, and who has refused to condemn the Russian invasion of Ukraine.
“With the war in Ukraine, the pressure to clean up the origin of diamonds is growing”
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