G7 to Discuss Plans for Russian Diamond Ban
G7 to Address Russian Diamond Ban Proposals
G7 countries are set to discuss four proposals for banning Russian diamonds from their markets starting January 1st. These plans, which range from self-regulation to strict import measures, reveal the challenges in reaching an agreement on the ban over the past year. The proposals, prepared by Belgium, India, a French jewelry industry group, and the World Diamond Council, will be examined during a technical meeting of G7 representatives on Thursday, according to sources close to the discussions.
G7 Ban’s Impact on Russian Diamond Exports
A ban imposed by the G7 would significantly impact Russian diamond exports, as these countries account for 70% of global diamond demand. However, it would also affect the supply side, given that Russia is the largest producer of rough diamonds, accounting for 30% of the global market. The primary objective of the upcoming meeting is to establish a legally sound definition of diamond traceability, enabling the identification of their origin.
Challenges in Formulating an Effective Ban
The difficulty in reaching an agreement stems from the fact that the ban targets Russian diamonds entering G7 countries from outside Russia. This indirect approach creates tension between prioritizing a political statement or addressing technical aspects first. Clearing up these issues is crucial before the January 1st deadline, especially if the selected model requires government controls, as this would prolong the legislative process.
Differing Proposals and Concerns
The proposals put forward by Belgium, India, France, and the World Diamond Council vary in terms of entry points for Russian diamonds into G7 markets, verification procedures for their origin, weight thresholds, and the consequences for non-compliance. Belgium, for instance, insists on stringent tracing and technology-based checks at its Antwerp hub to protect its reputation. India, on the other hand, is concerned about the impact on its small and medium-sized producers if a harsher model is adopted.
Importance of Collaboration and Public Announcement
Efforts are underway to develop a traceability mechanism, with intense technical calls currently taking place among G7 members. Diplomats with knowledge of the matter hope for a public announcement soon. The European Union and G7 have been considering a ban on Russian diamonds since 2022 as part of the sanctions imposed on Moscow following its invasion of Ukraine.
Conclusion
The issue of banning Russian diamonds from G7 markets remains complex and challenging. The upcoming technical meeting will provide an opportunity for G7 countries to address the proposals and reach a consensus on the best approach. The outcome of these discussions will have significant implications for both Russian diamond exports and the global diamond industry as a whole.
