G7 & the EU Sanctions Initiatives

Dec 02, 2023

FM-Russia, Alexey Moiseev have expressed on, the G7 and the EU Sanctions Initiatives! Discrediting the KP is part of the promotion by the West of its unilateral sanction initiatives against the Russian segment of the industry, clearly designed to limit market competition. The discriminatory measures of the G7, from their point of view, need to be legitimized by belittling the successes and consistently undermining the work of the KP as the only universal mechanism for controlling the international trade in diamonds.

The introduction of the G7 initiative, in essence, means the formation of a structure parallel to the KP and out of control by the diamond-producing countries that should replace the unambiguous and equal for all parameters for regulating the diamond industry with its own restrictive mechanism based on a biased political approach.

As I have already noted, such steps are aimed at legitimizing the political goals of the G7 through the creation of economically unjustified, artificial barriers to the diamond trade. This is not the first time Western countries have made such attempts.

The world market has already faced attempts to limit the development of the diamond industries in a number of African countries – Angola, Zimbabwe, DR Congo, and the CAR. However, now we see the goal set to create a sustainable sanctions mechanism, a cartel-like KP-2, to bar access to the diamond jewellery consumption markets for politically objectionable countries and companies. The artificial limitation of the diamond supply on world markets on the scale of total Russian production cannot be compensated from other sources because of their absence.

As a result, a possible short-term rush demand for diamonds from the remaining sources will be replaced by a sharp drop in supply, a slump in diamond prices, and accelerated replacement of natural stones by more affordable synthetics (LGDs), which, by the way, can be produced in unlimited volumes.

This will clearly provoke a policy of price competition for survival and, as a result, a frankly vulnerable position of all players in the natural stones market. Responsible industry players from mining to cutting and jewellery production risk losing their businesses in a very short time, and the diamond mining countries of Africa – the industry that is vital to the socio-economic development of entire regions, and ensuring the well-being of local communities in the mining regions.

The Russian Federation will make every effort to mitigate the destructive impact of the rash actions of the West. We, as the world’s leading diamond-mining country, are well aware that if the attempts of Western countries to virtually destroy the KP were successful, then the diamond community would irrevocably lose the unique multilateral regulatory mechanism to which it is accustomed and which it rightly values, trying to further develop and improve.

We will continue to join forces with friendly stakeholders in maintaining the effective operation of KP in the interests of our states and diamond mining regions, as well as the entire diamond market – diamond miners, cutters, traders and consumers who value gemstones that meet the highest industry standards.

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