In late February 2024, the Gem and Jewellery Export Promotion Council (GJEPC), World Federation of Diamond Bourses (WFDB), World Diamond Council (WDC) and International Diamond Manufacturers Association (IDMA) sent a letter to the G7 expressing their concern about the sanctions imposed on the Russian diamond industry. The industry organizations argue that the sanctions by the G7 countries may seriously damage the diamond industry as a whole and, moreover, will give additional competitive advantages to Russian rough diamonds. Particular objections were triggered by the G7’s requirement imposed on diamond producers (except Canada) to send their rough diamonds on a mandatory basis to Belgium where the gemstones should undergo certification. The initiators of the sanctions demand that Antwerp should become the only ‘entry point’ for rough diamonds into the G7 markets - and this is, supposedly, a necessary measure to cut off the Russian rough diamonds from the civilized market.
The arguments against such a decision come down to the following:
- mandatory sending the rough diamonds to Belgium entails additional costs required for their transportation, insurance, certification, registration, etc., which will inevitably increase the end consumer price of diamonds and thus make them less competitive compared to the Russian rough diamonds;
- the artificial transformation of Antwerp into a global diamond trading center contradicts the free market principle, gives unjustified competitive advantages to Belgium and illegally infringes on the rights of diamond trading centers in other countries;
- the Belgium’s intermediation enforced on the diamond industry complicates the contacts of diamond producers (primarily African ones) with their clients and make the contacts difficult, deprives the diamond producers of part of their legitimate profits and can become a driver of smuggling.
The arguments are completely fair and logical. It’s worth mentioning that they were formulated by the organizations which either indefinitely suspended or completely terminated the membership of either/both Russia or/and ALROSA. Thus, the Russians had minor influence on this initiative at most. This is truly the voice of the industry, the voice of the professionals who are driven by common sense and deep understanding of the realities of the diamond market rather than by immediate political interests.
The industry organizations’ objections are undoubtedly fair, but it should be mentioned that the sanctions mechanism used by the G7 countries manifests certain signs of racism. Indeed, the initiators of the sanctions have freed the Canadian rough diamonds from mandatory certification in Belgium, but rough diamonds from African and South American producers are subject to the mandatory certification in Antwerp. Why is Canada better than Botswana, South Africa, Angola or Brazil? Is it the skin color of the people in these countries and personnel of their diamond mining companies that is different? Are ‘white gentlemen’ more trustworthy? Do we really live in the 21st century? It looks like this is no longer a rhetorical question! And to answer it correctly, it’s worth recalling some of the circumstances that accompanied the establishing and development of the Belgian diamond hub.
Belgium was a major colonial power and had controlled the Congo Free State (now DRC) since 1885. The Belgium’s governing is the most shameful period in the entire history of the colonization of Africa, it was a pure and simple genocide of the local population, practically all the local people were turned into slaves, millions of them were systematically wiped out deliberately and cold-bloodedly, the Belgian administration practiced racism in the full sense of the word. In the world press, the Congo was called “the country of severed hands” because this was the punishment for the ‘blacks’ for failure to meet production standards set for harvesting latex (the main product of the colony) from rubber trees.
In 1906, the Forminiere mining company was set up in the Congo Free State. In 1913, this company started mining diamonds in the Belgian Congo. By 1940, about 10 mn carats of rough diamonds were mined in the Belgium’s colony, which amounted to almost 3/4 of the global production. These were mainly industrial diamonds that were in great demand on the market before World War 2. Being the leader in the rough diamond production (by volume), Belgium also carried the palm as a dealer and a cutting and polishing center because over 25 thousand diamond dealers and polishers worked in Antwerp, which is five times more than in Amsterdam that ranked second.
Since the outbreak of World War 2, Belgium maintained a neutral status and the Antwerp Diamond Center served as a legitimate source of rough diamonds for the United States and the Axis Powers. But on May 10, 1940, the troops of Nazi Germany crossed the border of Belgium, the Netherlands and Luxembourg, and on May 28, the Belgian army capitulated. The quick victory of the Nazis was by no means due to the weak Belgian and allied armed forces; on the contrary, Belgium significantly exceeded the Wehrmacht in the number of tanks and cannon gunnery and was inferior in aviation only. The success of the Germans can be explained, to a certain extent, by the attractiveness of Nazi racial doctrines to some Belgians, as well as by a great number of fascist and para-fascist structures in the Belgian society, such as the Rexist party and the right-wing Catholic organizations. After the occupation, Belgium became the leader in Europe in the number of collaborators per capita; broad collaboration with the Nazis was in all administrative and production areas, and Belgian volunteers also joined the 27th SS Division Langemark (1st Flemish) and the 28th Division SS Wallonien (1st Wallonien).
The Antwerp diamond center fell under Nazi control almost immediately, and it continued working efficiently. Its inventories, infrastructure facilities, communications, financial support, export-import channels - the entire ‘well-tuned’ machine - started functioning in the interests of the Third Reich without failures, resistance or sabotage. At first, even the ‘racially inferior’ people were left alone. But nevertheless, the ‘grim genius of the German nation’ brought some innovations to the diamond industry. Total accounting and control! Not a single carat should escape it! Total certification, tracing and ‘blockchain’!
Immediately after the occupation of Antwerp, Diamant-Kontrollestelle, a special department for diamond control, was established and it was headed by William Frensel, a Belgian diamantaire, collaborator and Gestapo agent. On January 30, 1941, this department was transformed into Diamantcentrale, a department consisting of the employees of the occupation government, German intelligence services, the Forminiere company and the Belgian Ministry of Economics. The headquarters, called Diamantcontrole, was in Antwerp. From this moment until the surrender of Nazi Germany in May 1945, the Third Reich had no difficulty in obtaining rough diamonds and manufacturing diamond tools used in its defense industry.
Fig.1. Gustaaf Breugelmans, the most influential Belgian collaborating diamantaire (center), and a German officer (right).
Hopefully, this brief historical insight can be useful to the Angolans, Namibians, Congolese and other Africans who will have to constantly travel to Antwerp now to acquire the ‘sanctions exemption’ for their rough diamonds. And then, looking at the dazzling smile of a Canadian colleague at some industry summit, think that this lucky person was spared regular ‘pilgrimage’ to Belgium, a country with such a ‘glorious’ colonial heritage and its war-time past - just because he is ‘white’. If rough diamonds can be divided into ‘good’ and ‘bad’ ones by their origin, what is barring to divide people by their skin color, and the Belgians, seemingly, have considerable historical experience in this matter.
Our African friends should also know that back in 2019, thirty Belgian citizens received pensions (from 425 to 1275 euros per month) for their service in the SS troops during World War 2. And their inheritors have rights to receive these sums of money, too.
And finally, do you know which European country is the largest importer of the Russian liquefied natural gas (based on the results of 2023)? That’s right, it’s Belgium! It is the Russian rough diamonds that are ‘bloody’ ones, but the Russian natural gas is blue and, besides, has no smell. And as you know, ‘Non olet pecunia!’ (Money does not stink!)
Sergey Goryainov for Rough&Polished
