Last week, the G-7 members engaged in discussions regarding four proposed plans aimed at preventing the export of large Russian diamonds. The Western countries’ plan suggests that from January 1, 2024, the fate of Russian precious stones will face significant uncertainty.
The proposed bans range from mild restrictions to complete halts, highlighting the challenges associated with achieving a consensus on the matter. Reuters reports that coal bans have proven difficult to enforce for over a year, underscoring the complexity of implementing such measures.
The four proposals were put forth by Belgium, India, the French Group for the Jewelry Industry, and the World Diamond Council. They will be evaluated during a technical meeting of G-7 representatives, as confirmed by local residents close to the matter.
If implemented, such a ban would severely limit the export of Russian diamonds since the G-7 countries, including the US, Canada, Japan, Germany, the United Kingdom, Italy, and France, account for 70% of the world’s diamond production.
Consequently, the ban would have a significant impact on the diamond trade, particularly because Russia is the largest producer of rough diamonds globally, holding a 30% market share.
Meanwhile, the foremost diamond producer, the state-owned company “Alrosa,” has been grappling with a diamond shortage for the past two months. Bloomberg reported in September that the company had reduced its supply of rough diamonds in an attempt to counter falling prices. However, there is hope that this downward trend will be reversed.
Alrosa, which is currently vying with industry giant De Beers for the title of the world’s largest diamond producer, faces additional challenges due to American and British sanctions imposed following the commencement of the Russian War in Ukraine. Consequently, the company’s supplies have been impacted, leading to a redirection of shipments towards Asia.
As the G-7 continues to deliberate on the proposed bans, the fate of Russian diamonds remains uncertain. The outcome of the technical meeting will likely shed light on the future of the diamond trade and its potential implications for global markets.