G7 Summit - sanctions for Russian diamonds at last?

G7-Gipfel - Endlich Sanktionen für russische Diamanten?

In March, it was announced that the G7 countries were planning to impose new sanctions to restrict trade in Russian diamonds. You can read our report here. Last Friday, the G7 summit began and it will soon become clear what these sanctions will look like.

According to Tagesschau, a declaration restricting the export of Russian rough diamonds was to be adopted in the course of the G7 summit, which took place in Hiroshima from May 19-21. This is to prevent revenues from the diamond trade being used to help finance Russia's war of aggression against Ukraine. Indeed, the Russian company Alrosa, the world's largest diamond producer, which accounts for about one-third of the rough diamonds mined worldwide, is 20% owned by the Russian Federation. Already on the first day of the summit, EU Council President Charles Michel confirmed that further sanctions are planned, affecting Russia's diamond trade. In doing so, he found clear words: "We will restrict trade in Russian diamonds. Russian diamonds are not forever." Furthermore, Michel stated that an appropriate tracking system will be worked out to ensure that Russian diamonds do not enter the Western market through third countries, as they have in the past. As we reported earlier, the principle of substantial transformation is problematic here. According to this, a diamond that has been mined in Russia but, for example, has been cut and polished, i.e. substantially transformed, in India, can be resold as "made in India".

We are eagerly awaiting the results of the G7 summit and hope that it will be possible to work out measures that are as effective and implementable as possible. Now that revenues from the diamond trade have presumably been flowing into the Ukraine war for a year, it is urgently necessary for the major economies to jointly take consistent measures to stop this. After all, unlike the U.S., Europe, for example, has not yet imposed any sanctions on Russia in this regard.

As soon as there is news on this topic, you will be informed in the DIAVON News.

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Source: Article "G7 wollen Export russischer Diamanten begrenzen" from Tagesschau, 18 May 2023
Image: Adobe Stock | 207254776

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