Wednesday

7th Dec 2022

Russian diamonds ban 'would cost 10,000 jobs', Antwerp claims

  • Jewellery shopping in Antwerp: Would you buy a Russian diamond? (Photo: Kris Jacobs)
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As the EU Commission mulls adding Russian diamonds to a new sanctions package, the Belgian diamond industry voices concern for massive job losses.

When asked by EUobserver if he'd personally buy a Russian diamond for his girlfriend, one Antwerp diamond quarter lobbyist hesitated for a long time.

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But as the EU prepares a near-total Russia diamond embargo in reaction to the war, the Antwerp spokesman said: "In the end: Yes, I would buy a Russian diamond even though I knew where it came from".

He'd personally do it to "protect" people's jobs in Antwerp and in poor Russian regions, Tom Neys, the Antwerp World Diamond Centre (AWDC) spokesman said.

The AWDC was against an EU ban, Neys added, because Russia would be "welcome with open arms" to sell its diamonds in the Middle East or Asia instead.

Belgian diplomats had raised similar objections in previous EU talks on Russia sanctions.

Belgium's support is vital because Antwerp's Diamond Square Mile is the world's largest and Europe's only important trading centre, which handles up to one third of Russia's exports.

The ban would put 10,000 people out of work in Antwerp, the AWDC estimates.

But for all that, Belgian prime minister Alexander De Croo has also said publicly that he wouldn't veto a ban if there was overwhelming support for one in the EU.

And Belgian officials informed EUobserver on Monday (26 September) that "nothing had changed" in De Croo's position, as an EU majority for the move builds momentum.

Ireland, Poland, and the Baltic states have redoubled diamond-ban calls in reaction to Russia's plan to annex eastern Ukraine.

The EU Commission is expected to propose an EU ban on "non-industrial" Russian diamonds (covering the vast majority of exports) in the next few days, after speaking in "confessionals" with all 27 EU capitals over the weekend to see which way the wind was blowing.

"It's on the table. A majority wants it in the new sanctions package and the Belgians have said they won't veto it," an EU diplomat said

"There's no fierce opposition [from Belgium]," a second EU diplomat said.

Russian diamond exports are worth some €4bn a year — a drop in the Kremlin's petro-income bucket.

But if the ban's impact on Russia would be mostly symbolic, it would cause a genuine earthquake in world diamond markets, the AWDC predicted.

Russia could take its diamonds from Antwerp to Dubai or India "overnight" and they might never come back to Europe, Neys said.

The world diamond market is like no other, because "all five-carat diamonds produced in a year worldwide fit in a basketball," he said.

"This is the most condensed high-value product on the planet, easy to transport in your pocket on a plane. It's not like oil or coal," he added.

The shift to Middle East or Asian markets would also set back industry reforms "to the Middle Ages", because Antwerp had the world's best anti-money laundering regime, Neys claimed.

Blood diamonds?

The AWDC favours a multilateral rather than EU approach that leaves it for consumers to decide whether or not to buy Russian stones.

But when asked how easy it was for Antwerp shoppers to currently know if the diamond in their fiancee's ring was Russian, Neys said cut diamonds were harder to trace than uncut ones.

"You can ask. And if the seller has a certificate, then you'll know," he said.

Questioned if it was fair to call Russian diamonds "blood diamonds", by analogy with a popular film about Africa, Neys said the preferred industry term for such stones was "conflict diamonds".

For his part, Ukrainian president Volodymyr Zelensky has been calling for Belgium and Antwerp to put morality first since March already.

And one EU diplomat from the pro-ban camp debunked the AWDC's argument.

"You could say the same for sanctions on any Russian economic sector — that they won't stop the war and that they'll cost jobs," the diplomat said.

"Targeting Russia's luxury goods might be symbolic, but it's exactly the kind of political symbolism we need, because it gets into the heads of the Russian elite," he added.

"Antwerp has to do its homework if it wants to have a viable business in future," another EU diplomat said. "It's in its own interests, in the long-term, to turn away from Russia," he said.

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