The diamond market has cracked – Kommersant FM
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The head of the Antwerp World Diamond Center (AWDC) resigns due to anti-Russian sanctions. Ari Epstein held this post for 13 years. The reasons for the decision were not disclosed in official statements. However, as the leading Flemish newspaper De Tijd writes, citing sources, the reason was a conflict with the Belgian government, which previously supported a ban on the import of Russian diamonds.
It has not been announced who will replace Epstein as the center’s general director. But the consequences of his resignation are still difficult to assess, notes TASS correspondent in Brussels Denis Dubrovin: “Ari Epstein actually headed Antwerp’s historical business associated with diamond processing; it has always been run by the Jewish community living in the Flemish city. Ari Epstein is an iconic figure for both the city’s diamond industry and Antwerp’s Jewish community.
Therefore, of course, his resignation will have a serious impact on the diamond sector of Antwerp, but it is, of course, quite difficult to predict in advance how. First of all, because the resignation became unforeseen, Epstein himself is not a media figure and does not voice his intentions in advance; he also never said anything about this. Moreover, the reasons for this resignation are still unknown. The Antwerp Diamond Center’s statement released today about Ari Epstein’s resignation also contains no information about the reasons.”
About a third of all diamonds in the world are mined in Russia. At the same time, 90% of production falls on the world’s largest company ALROSA; on January 3, 2024, it came under EU sanctions. As Reuters notes, after restrictions on the import of precious stones into the European Union from Russia came into force on March 1, Antwerp diamond dealers faced long and costly delays. Now, to import stones into the G7 countries and the EU, declarations are required that they are not of Russian origin.
All this seriously affects the entire diamond market, notes Vladimir Zboikov, executive director of the Russian Jewelers Guild: “The total market is up to $60 billion, this is the turnover of rough diamonds. And in this market the lion’s share went to Belgium. It is also much larger than a mining market. And here Russia suffered virtually no losses, because we, while exporting precious stones, did not participate in the further chain of their resale. The Russian Federation’s share of 35% of production deals a very serious blow to this entire chain.
Naturally, no one wants to lose money, and they will look for ways to circumvent the sanctions in any case. Be that as it may, the global diamond market has lost a lot from this. And it is not a fact that it will generally remain in the future in the form in which we knew it. At least in small-cut diamonds, synthetic diamonds may play a significant role in the market. Working with them will no longer be so marginal, that is, the margin of the market as a whole is lost.”
By September 1, 2024, G7 countries must develop and implement a system for tracking and certification of precious stones. Belgium will play a key role in this process, since Antwerp is one of the largest centers of the world diamond trade. Belgian Prime Minister Alexander de Croo spoke about this in December 2023.
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