The EU sanctions Alrosa, the leading Russian company in the world's international diamond trade

This Wednesday, the European Union included Alrosa, the world's leading diamond company, and its executive director, Pavel Marinichev, in its list of sanctions against Russia. The measure, contemplated almost since the Russian offensive in Ukraine began in 2022, but delayed again and again, thus completes the siege of the Russian diamonds prepared together with the G-7 that took another key step on December 18, when the Twenty-seven adopted the twelfth package of sanctions against Moscow, which already included a ban on the purchase and export of Russian diamonds as of January 1, 2024, a measure that extends to all members of the group of most developed countries in the world.

The high representative of the EU for Foreign Policy, Josep Borrell, has highlighted on of the G-7 to deprive Russia of this important source of income.”

Russia is the world's main producer of rough diamonds, with 30% of the global market that until now has brought Moscow around 4 billion euros each year. And Alrosa is the largest company in the sector, responsible for 90% of the total Russian production of these precious stones, so “the company constitutes an important part of an economic sector that is providing substantial income to the Russian Government,” the EU Council announcing the inclusion of the firm on the Russian blacklist, which thus amounts to almost 1,950 individuals and entities.

Being sanctioned by Brussels means that these people and companies see their assets located in European territory frozen. The targeted individuals are also prohibited from traveling or stopping in the EU, while European companies or citizens are also prohibited from doing business with those sanctioned.

The EU had been considering since at least September 2022 the possibility of including Alrosa on its list of sanctioned Russian companies and imposing a general ban on the trade in diamonds of Russian origin. But, fearful of a measure that could also seriously affect one of its key industries – the Belgian city of Antwerp is the main world center for diamond trading – the Belgian Government repeatedly vetoed this measure until it was done at G-level. 7, which is where 80% of these precious stones are sold. The Executive of Alexander de Croo, who has just assumed the rotating presidency of the EU Council from Spain, also demanded a reliable “scientific” traceability system for diamonds from their origin, to prevent Russian stones from being polished by third parties. countries – especially India – and thus be marketed as gems originating from a non-sanctioned country, which would have further damaged the Belgian diamond trade.

The tables began to turn in May of last year, when at the G-7 summit in Hiroshima the leaders of the world's seven largest economies agreed to “work together to restrict the trade and use of diamonds mined, processed or produced by Russia.” . The final decision was made on December 6, when the club made up of Germany, Canada, the United States, France, Italy, Japan and the United Kingdom (and the EU) announced the ban in their markets, starting January 1. 2024, of non-industrial gems mined, processed or produced in Russia. Less than two weeks later, on December 18, the Twenty-Seven gave their final approval to package number 12 of sanctions, which already included the prohibition of the “import, purchase or transfer, direct or indirect, of diamonds from Russia.” , including those processed in third countries, as required by Belgium and had been agreed at the G-7 level.

The measure began to come into force this Monday, January 1, with the direct ban applicable to Russian natural and synthetic diamonds, as well as jewelry that includes these precious stones of Russian origin. As of March 1, a transition period also begins that will end on September 1, the date by which the ban on indirect imports of Russian diamonds processed (cut and/or polished) in third countries will also be completed. The six months are necessary, according to the EU, due to the “need to deploy a traceability mechanism that allows the efficient application of measures and minimizes disruptions to the EU market.”

Follow all the international information on Facebook and xor in our weekly newsletter.

_