G7 countries are to meet this week to discuss four plans on banning Russian diamonds from their markets.
Belgium, India, the French jewellery industry group and the World Diamond Council (WDC) have prepared four proposals to be discussed at a G7 technical meeting on Thursday.
The G7 ban will severely affect Russian diamond exports, as the countries – the United States, Canada, Japan, Germany, the United Kingdom, Italy and France – account for 70 per cent of the world’s demand for diamonds. At the same time, Russia accounts for 30 per cent of world’s rough diamond production.
The main topic of discussion is to agree on a definition of diamond traceability in order to be able to determine the origin of gems.
“Part of the reason we are stalled is that … it’s an indirect ban – it’s on Russian diamonds coming [into G7] from outside Russia. It’s more complicated. There’s tension between keeping momentum with a political statement first or whether the technicals need to be decided in full first.”
The source informed that the countries wanted to resolve the issue during November in order to start working as early as January 1, as the introduction of state control required time for the necessary amendments to the legislation.
The adoption of the agreement is further complicated by the fact that the ban could affect business conditions for some of the world’s largest diamond centres in Belgium, India or the United States.
Major differences between the proposals are the place of diamond supply to the G7 markets, the method of verifying the stones’ origin, thresholds for weight and liability for violating the rules.
India and Belgium want the entry point to be their own diamond centres in Mumbai and Antwerp respectively, while the French group wants multiple entry points; the WDC wants a more self-regulated system. The weight threshold for gemstones can be one carat or more for polished gems.
There are intense G7 technical calls on the traceability mechanism taking place now. We hope there can be a public announcement soon.
The European Union and the G7 are considering a ban on Russian diamonds from 2022 as part of sanctions against Moscow over its war in Ukraine. After the outbreak of the military conflict, major jewellers, such as the US brand Tiffany’s, stated that they would no longer buy Russian diamonds.
Negotiations on a ban for Russian diamonds have been progressing slowly, although these gems, along with nuclear power and liquefied natural gas, are among the few remaining significant sources of revenue for Moscow.
