EU To Cut Off Russia From Diamond Market

The European Union (EU) is poised to impose a ban on imports of Russia’s diamonds — cutting off the world’s biggest diamond producer from one of its key markets.

Photo Insert: Russia produces around a third of the world’s diamonds, and is the single biggest exporter.

“Russian diamonds are not forever,” European Council President Charles Michel said at the sidelines of the G7 summit in Hiroshima, Japan, on Friday, May 19, 2023, Anna Cooban reported for CNN.

A plan to sanction the Russian industry, worth $4 billion in exports, could be unveiled as soon as this weekend, a senior EU official told journalists during a briefing on Thursday.

Russia produces around a third of the world’s diamonds, and is the single biggest exporter, according to the Antwerp World Diamond Center (AWDC), which represents the world’s biggest diamond trading hub in Belgium.

The EU ban will come as part of an 11th package of sanctions over Russia’s full-scale invasion of Ukraine in February 2022, more than a year after the US prohibited its companies from buying Russian diamonds for non-industrial purposes.

On Friday, the UK also announced it would ban imports of Moscow’s diamonds later this year, as well as all imports of copper, aluminum, and nickel of Russian origin. The EU ban will affect Russia’s finances, as well as European retailers and traders of diamonds.

Buyers of luxury jewelry and watches may also feel the impact in their wallets. Russia’s diamond exports generated about $4 billion in 2021, according to the UK government.

The value of total Russian goods exports that year was $494 billion, according to the country’s central bank. Oil and gas accounted for about half of that figure.

The country’s diamond industry already took a big hit in April 2022, when the US banned imports from Alrosa, a Russian state-owned mining company responsible for 90% of Russia’s diamond mining capacity.

The US accounts for half of the global demand for diamonds used in jewelry, said Paul Zimnisky, an independent diamond industry analyst, while Europe and the United Kingdom together represent only around 5% of the market, Jake Kwon, James Frater and Niamh Kennedy also reported for CNN.

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