The European Union (EU) is planning to tighten economic sanctions on Russia by imposing more restrictions on trade in precious stones, specifically diamonds. Meirid McGuinness, the European commissioner for financial stability, stated on the European Parliament’s website that Brussels is exploring ways to curtail the trade and use of Russian diamonds in order to diminish Moscow’s export revenues. This announcement comes in response to a query from MEP Tomas Zdechovsky, who claimed that significant quantities of uncut gems from Russia are being exported through EU channels and worldwide.
Zdechovsky submitted his query on May 31st, asking if the EU was considering including the Russian export of uncut gems in the sanctions package that was being prepared at the time. Presently, Russian synthetic or reconstructed gemstones are banned from import under the current EU sanctions, while other gemstones and diamonds face no import restrictions unless they are set in gold jewelry.
However, McGuinness responded to Zdechovsky a month later, on June 23rd, after the latest round of sanctions had already been approved. These new measures primarily focused on preventing Russia from circumventing existing trade restrictions with the assistance of third countries and did not address the diamond issue.
In her response, McGuinness highlighted that the commission collaborates with G7 countries and other key partners, including the industry, to devise and ensure the effective implementation of future coordinated restrictive measures, including through the use of tracing technologies. Diamond tracing allows for the verification of the origin of precious stones and enables the tracking of their journey from the mine to the jeweler.
McGuinness emphasized that any decision to extend or amend existing restrictive measures on imports from Russia would require unanimous agreement from the council. This signifies that all EU member states must be in agreement for any changes to be made.
In May, Moscow stated that if the EU imposes sanctions on Russian diamonds, it will seek buyers elsewhere, indicating that it will find alternative markets.
It is important to note that the expansion of economic sanctions on Russian diamonds could potentially disrupt the global jewelry market. Analysts have expressed concerns about the potential price hikes and limited supply if these restrictions are implemented. The diamond trade plays a significant role in the global economy, and any disruptions can have far-reaching consequences.
As discussions and considerations continue regarding the tightening of economic sanctions on Russia, it remains to be seen how the EU will address the trade in Russian diamonds and its potential impact on the market. Any decision made by the council will significantly influence the future trade dynamics between the EU and Russia.