Ban on Russian Diamonds, a Weighty Decision

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Editor’s Note

This article examines the G7’s 2024 decision to ban Russian diamond imports, a move aimed at weakening a key revenue stream for Moscow following its invasion of Ukraine. The piece explores the intended economic impact and the broader context of Western sanctions.

The G7’s Decision and Its Impact

At the beginning of 2024, the G7, the group of the world’s seven richest economies, decided to ban the purchase of Russian diamonds. This sanction joined those already imposed on Russia by Western countries and their allies due to the invasion of Ukraine.

By deciding to impose sanctions on Russian diamonds, the West’s objective was to weaken the Russian economy, as Russia is the world’s largest diamond producer. They therefore decided to ban the import of diamonds of one carat and more extracted in Russia, even if the stones have been cut elsewhere.

This decision risks destabilizing the global diamond market, particularly in Africa.

For example, the Russian state-owned mining company Alrosa holds a 41% stake in Angola’s main diamond mine, Catoca. Although the Angolan mine is not subject to sanctions, M’Zee Fula Ngenge, Director of the African Diamond Council, points out that it is now under pressure due to its link with Alrosa.

Opportunity and Exclusion for Africa

According to M’Zee Fula Ngenge, these sanctions give Africa a chance to gain market share.

“When examining the G7 decision that affects the global diamond industry, one must take into consideration the fact that Africa is the dominant producer collectively,” he explains.

While among the G7 countries, only Canada is a diamond producer, actors in this sector in Africa believe that the G7 should have consulted them before deciding on the ban on Russian diamonds.

“They [the G7 leaders] totally excluded us from the discussion while we consider ourselves the world leaders [in diamond production]. They should have addressed us first,” says M’Zee Fula Ngenge.
The Certification Issue and Supply Chain Disruption

The G7 sanctions now oblige African countries to send their diamonds to Antwerp, Belgium, for certification. The city is considered the hub of the global diamond industry.

According to some countries like Botswana, one of Africa’s largest diamond producers, this change has disrupted the supply chain. On June 21, Botswana’s President Mokgweetsi Masisi will meet with government and business representatives in Berlin on this matter.

Diamonds extracted in Africa are already subject to the Kimberley Process, which guarantees that no “blood diamonds,” i.e., extracted in conflict zones, enter the market.

For Fula Ngenge, “pushing everything towards Antwerp is a step backward,” especially since, according to him, African diamond producers strictly respect Kimberley Process certification.
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⏰ Published on: June 20, 2024