GEMOLOGY

EU takes aim at Russia's diamond trade in latest round of sanctions

Sector estimated to be worth about $4.5 billion a year

Russian President Vladimir Putin. Russia is now prohibited from directly and indirectly importing, purchasing or transferring diamonds, the EU said. 

Soraya Ebrahimi
Dec 18, 2023

The European Council has adopted a new package of Russia sanctions that focus on the country's diamond trade, which involves import and export bans as well as measures to combat sanctions circumvention.

The European Commission announced the 12th package of sanctions against Russia on Monday after Austria gave its final approval at the weekend.

Russia is now prohibited from directly and indirectly importing, purchasing or transferring diamonds, the EU said in a statement.

It is also subject to a new import ban on liquefied petroleum gas, which will affect annual imports worth $1.09 billion.

The EU estimates the diamond sector to be worth about $4.5 billion a year to Moscow.
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The new round of sanctions also obliges EU companies to prohibit in their contracts the export of certain goods so buyers cannot sell them on to Russia – particularly “sensitive goods and technology” that could be used by the Russian armed forces in Ukraine.

Additional chemicals, lithium batteries, thermostats, certain electric motors that could be used in the manufacture of drones, and some machine tools and parts have been put on the EU’s list of items banned for export to Russia.

Imports into the EU of some goods that generate significant revenue for Russia also were tightened, including copper and aluminium wire, foil, quantities of tubes and pipes above a certain limit, and liquefied propane.

The package also added 140 additional people and entities as subject to asset freezes, including figures in the Russian military, the defence industry, private military companies and the IT sector.

The EU said the latest measures would “deliver a further blow to [Russian President Vladimir] Putin’s ability to wage war by targeting high-value sectors of the Russian economy and making it more difficult to circumvent EU sanctions”.

While the European Council announced the adoption of the package last week, Austria did not give its formal approval until its major bank Raiffeisen was suspended from a Ukrainian list called “international sponsors of war”.

The Ukrainian blacklist temporarily removed the bank pending discussions with the European Commission. The commission declined to comment on the matter on Monday.

Hungary and Greece similarly delayed the previous package of sanctions to have some of their companies removed. Two Greek shipping companies are still in the suspension phase on the website.

The 27 EU countries will now consider imposing sanctions on people who benefit from the seizure of European assets or parts of companies in Russia.

The member states will also come under tighter control to ensure they are actively tracing the assets of sanctioned people.

Updated: December 18, 2023, 10:31 PM