Diamonds in the spotlight as new EU sanctions approach
The European Union (EU) has confirmed a 10th round of sanctions will be placed on Russia in response to the invasion of Ukraine, leading to further speculation over the future of the diamond industry.
EU Commission president Ursula von der Leyen released a statement on 3 February confirming plans to implement a new round of sanctions prior to the one-year anniversary of the invasion of Ukraine on 24 February.
“At this summit, we also discussed how to make Russia pay for the brutal destruction it is causing. We are exploring with our partners the options we have for that. The perpetrator must pay and must be held accountable,” she said.
Russia is responsible for approximately one-third of the world’s supply of diamond rough via mining juggernaut Alrosa.
Around 85 per cent of the world’s rough passed through the Belgium city of Antwerp on its way to consumers with an estimated 10,000 people relying on the trade for employment – a fact which has prompted the Belgium government to resist calls for sanctions on the trade or prohibition of Russian diamonds in the past.
EU representatives from Ukraine, Poland, and Lithuania have repeatedly called for an end to trade with Russia, and now it appears that the approach for Belgium’s leaders may have changed.
According to Belgium’s prime minister Alexander De Croo, Russia’s sale of diamonds to western markets needs to end.
“Russian diamonds are blood diamonds,” De Croo said in a statement to POLITICO.
“The revenue for Russia from diamonds can only stop if the access of Russian diamonds to Western markets is no longer possible. On forging that solid front, Belgium is working with its partners.”
De Croo was supported by Belgian minister Vicky Reynaert.
"It's becoming impossible to explain that Belgium is not open to blocking Russian diamonds," Reynaert said.
"We want Belgium to actively engage with the European Commission to take action."
This call for action was again resisted by the Antwerp World Diamond Centre with spokesperson Tom Neys questioning the effectiveness of sanctions.
"Sanctions are not the solution,” said Neys.
“An international framework of complete transparency, with the same standards of compliance as Antwerp, can be that solution.”
Such a framework may involve provenance requirements within which the importer would be responsible for providing evidence that the diamonds are not of Russian origin.
“The Belgium government has suggested an international traceability requirement,” Neys told JCK Online.
“The proposal would mean that every company who wants access to the US, EU, and other G7 markets would need to provide provenance information.”
Nine rounds of sanctions have been adopted by the EU against Russia with the most recent of these coming into effect in December.