How More Sanctions on Russian Diamonds Could Affect the Global Market
The Group of 7 and the European Union are expected to issue new rules in an effort to slow the flow of revenue into the Kremlin’s war chest.
By Elizabeth Paton
Elizabeth Paton covers the international fashion industry from London
New York Times
Aug. 28, 2023
Nineteen months have passed since Russia invaded Ukraine, sending shock waves around the world — and through the global diamond market.
Russia is the world’s biggest diamond exporter by volume, with a state-owned company, Alrosa, mining almost one third of all diamonds produced in 2021.
To prevent funds from flowing into the Kremlin war chest, the United States — the world’s largest market for finished diamonds — took action last spring when President Biden banned the import of rough diamonds from Russia and the U.S. Treasury Department placed sanctions on Alrosa.
Other countries imposed sanctions of their own, including Britain, which early this year announced an outright ban on Russian diamonds.
Last year the European Union had tried several times to enforce sanctions on Russian diamonds, but was prevented by Belgium because of protests from Antwerp, the Belgian port city that is a leading trade hub for precious stones. Its representatives have expressed concerns that, aside from the difficulty that comes with tracking a diamond’s true origin, sanctions could hand Antwerp’s rivals, like Dubai and India, a competitive advantage on the Russian diamond trade. Not everyone agreed.
“There are people for whom the diamonds sold in Antwerp are more important than the battle we are waging,” President Volodymyr Zelensky of Ukraine said last year.