Russia will Find Ways Round G7 Diamond Ban
January 07, 24
(IDEX Online) - The G7 sanctions are unlikely to have a significant impact on exports of Russian diamonds, according to analysts quoted by Tass, the state-owned news agency.
They say Russia, the world's biggest diamond producer by volume, will simply sell to other markets.
They also say it will take years to properly develop the technology needed to outlaw the diamonds it produces.
Alexey Kalachev, analyst at Russia's securities brokerage Finam, said it would take years to introduce a blockchain system that gave each diamond its own digital passport.
"As of now, such a mechanism (inspection and certification of diamonds) does not exist, neither will it appear by March 1, and it is unclear whether it will be ready by September 1," he said. "This only suggests certain possibilities of [so-called] 'grey' supplies".
Sanctions on Russian diamonds over 1.0-ct came into effect on 1 January. They will be expanded on 1 March to cover stones that are cut and polished in another country, and on 1 September to cover all diamonds up to 0.50-cts, together with a mechanism - as yet unspecified - aimed at outlawing Russian goods.
Boris Krasnozhyonov, securities market research chief at Alfa-Bank, the largest private bank in Russia, said sanctions were increasingly "cosmetic" in nature. Commodities such as diamonds would readily to flow to other locations, he said.
Olga Belenkaya, head of macroeconomic analysis at Finam said that as a major supplier there was little doubt Russia would find ways to evade the ban.
Pic courtesy Alrosa shows rough diamond sorting