Hiroshima summit: G7 want to restrict exports of Russian diamonds

The group of leading democratic industrial nations wants to restrict the export of rough diamonds from Russia, which is worth billions. A corresponding declaration should be decided at the G7 summit in Hiroshima, Japan, as several diplomats from the German Press Agency said. Russia’s war against Ukraine is among the main themes of the three-day meeting, which begins on Friday.

The G7 countries are also discussing how existing sanctions can be prevented from being circumvented. Chancellor Olaf Scholz (SPD) is confident that the G7 countries will find common ground.

According to a media report, Ukrainian President Volodymyr Zelenskyy could make a surprise trip to the summit. A meeting on site depends on the military situation, the Japanese news agency quoted Kyodo Ihor Zhovkwa, the vice chief responsible for foreign policy in the presidential office.

In addition to Japan and Germany, the G7 includes the USA, Great Britain, France, Italy and Canada as well as the European Union.

Russia is the world’s largest producer of rough diamonds

According to information from G7 circles, the new plans are about a coordinated reduction in Russia’s income from the sale of rough diamonds. The aim is to ensure that gemstones traded via countries such as India and the United Arab Emirates can still be identified as Russian diamonds after they have been resold. In the EU, the trade in Russian diamonds has already fallen by around 80 percent as a result of voluntary commitments, it said.

The diamond trade is a significant source of income for Russia. In 2021, the last year in which the state-owned diamond promoter Alrosa disclosed its figures, the company generated 332 billion rubles (around 4 billion euros) in revenue. Russia is the world’s largest producer of rough diamonds.

So far, however, the EU has not restricted trade. One of the reasons has so far been resistance from Belgium. The Flemish port city of Antwerp has been considered the diamond center of the world since the 16th century.

The USA, Canada and Great Britain had imposed sanctions on Alrosa. According to the outgoing Alrosa CEO Sergei Ivanov, this has hardly harmed the group. Ivanov has recently expressed optimism that new sanctions will not take effect.

Closing loopholes in trade sanctions

The planned joint G7 declaration is intended to deal with circumventing existing trade restrictions that have been imposed on Russia since the attack on Ukraine.

According to Chancellor Scholz, the aim is to further develop the sanctions regime in such a way that it is not possible to circumvent it. “I’m assuming that we can get along very well on all the issues,” he said on Thursday after his arrival in Hiroshima.

US President Joe Biden’s national security advisor, Jake Sullivan, spoke of shutting down bypass networks and closing loopholes. In connection with the planned G7 declaration, he held out the prospect of a new US sanctions package.

Among other things, Chinese companies are accused of delivering goods from the EU to Russia that could be used for warfare. The EU Commission recently proposed creating the legal possibility of restricting selected exports of goods that can be used for military purposes to certain third countries.

According to diplomats, however, the initiative is far from being viewed unreservedly positively by all EU states. The danger is therefore that member states might not have the courage or the will to put countries like China on such a list because of possible retaliatory measures. For Germany, China has been the most important trading partner in the past seven years.

A complete ban on exports to Russia is not expected

The proposal to ban exports to Russia in principle and to make exceptions only possible for carefully selected products is currently not considered to be consensual. Sullivan said he doesn’t anticipate such an export ban.

So far, export bans have only been imposed on selected products in response to Russia’s war of aggression. In the EU, these include, for example, aircraft, luxury goods and certain computer chips.

G7 also talk about China, climate and nuclear weapons

The global economy, climate protection and how to deal with China’s striving for power are also on the agenda of the summit. To strengthen cooperation with the Global South, host Japan has invited partners such as India, Brazil and Indonesia.

Chancellor Scholz also expects a clear signal against the use of nuclear weapons. “The nuclear catastrophe that has been experienced here is a reminder to all of us that we must ensure that nuclear weapons are never used,” he said. Hiroshima was largely destroyed in 1945 by the first atomic bomb in history.