How Botswana stood its ground against G7 countries on diamond certification

Botswana has requested a meeting with the G7 leadership before the scheduled implementation of diamond certification to weed out Russian diamonds can start in September in order to ensure a mutually beneficial outcome.

Insiders say that Botswana asserted her rights when addressing the G7 Countries Technical Team of Experts during their visit last week.

The nation emphasised that its development, including the diamond industry, has evolved through years of collaboration with industry experts, requiring the dedication, hard work, and significant sacrifices of the Batswana people to establish a sustainable legacy for future generations.

Botswana further expressed her desire to be considered as a potential partner or node. The G7 Technical Expert Team, led by the United States, reportedly expressed their intention to continue discussions with Botswana to ensure that all diamonds beneficiated in the country remain for that purpose.

They also expressed interest in collaborating with the Botswana team in communication, leveraging the goodwill that has already been established.

The G7 technical expert team reportedly conveyed to Botswana their mission to discover a well-balanced approach in executing the G7 leaders' declaration, which entails imposing direct sanctions on Russian diamonds by January 1, 2024, implementing an indirect ban by March 1, 2024, and instituting a complete ban with technological certification by September 1, 2024.

Additionally, the G7 team mentioned Belgium's pilot study and expressed a desire for Botswana companies, particularly Okavango Diamond Company and Lucara, to be involved. It was clarified to the G7 that their visit was an appreciation and demonstration of Botswana's robust processes and protocols, including relevant legal instruments, rather than an audit.

Botswana expressed openness to address any identified gaps and conveyed gratitude for the opportunity to visit G7 countries to understand their systems and gain insights into the issues being discussed. The country also appealed to the G7 to understand and bear with any subsequent actions and concerns that may take centre-stage in this matter.

Despite this, Botswana assured continued engagement with like-minded strategic stakeholders, especially diamond-producing countries, to advance its goals.

The G7 team was reminded that Botswana, along with its diamond industry, has evolved over many years through collaboration with industry experts, involving the sweat, tears, and significant sacrifices of the Batswana

people to build a sustainable legacy for future generations.

Botswana welcomed the G7's commitments to swift engagement with a focus on results. The country expressed its desire to meet with G7 leadership to further discuss this matter, emphasising its serious concern and the potential to disrupt Botswana's development agenda as outlined in Vision 2036.

Botswana's involvement in addressing G7 sanctions on Russian diamonds reportedly commenced during the FACETS 2023 conference on October 24, 2023. Then subsequently Botswana Technical Team made a trip to Belgium in November 2023.

The G7 Technical Expert Team was invited to visit Botswana from January 15th to 19th, 2024. This visit aimed to enhance the G7's understanding of Botswana's diamond pipeline processes and assess the mechanisms, if any, that Botswana had implemented to comply with G7 requirements.

Botswana prioritised transparency, allowing the G7 Technical Expert Team unrestricted access, including a tour of the Jwaneng Mine, Lucara and HB, and held meetings with officials from the Ministry of Minerals and Energy, BURS, Botswana Police Service, and Diamond Hub.

During this tour, Botswana shared her diamond story, covering discussions where the G7 delegation sought clarity and understanding, with an emphasis on the processes of handling diamonds. Additionally, the team reportedly visited the Diamond Hub and Security/Shipping companies.

The G7 delegation extended their visit to the Diamond Trading Centre Botswana (DTCB) and DeBeers Global Sight Holders Service (DBGSS). These visits included an overview of the diamond pipeline and discussions on tracer technology's new developments.

The tracer technology, focusing on determining provenance and origin, stressed the importance of placing it at the source, considering factors such as cost, size, and stone quality.

While meetings with ODC aimed at understanding diamond trading independent of De Beers and Botswana’s beneficiation objectives, the delegation engaged with industry representatives to gather perspectives on sanctions and potential consequences to their operations.

The G7 team also visited the Gemmological Institute of America (GIA), a certification lab for polished diamonds that expanded its services to include certifying rough diamonds for provenance. These meetings successfully demonstrated Botswana's effective controls and capabilities in certifying its own diamond production and preventing possible contamination. Information reaching Botswana Guardian indicates that following the Russia-

Ukraine conflict in February-March 2022, some G7 countries—specifically the United Kingdom, United States, and Canada—implemented sanctions on Russian rough diamonds.

Conversely, France, Japan, Italy, and the EU did not impose such measures. However, during their meeting in Japan in May 2023, the G7 collectively agreed to introduce additional sanctions on both Russian rough diamonds and polished ones. Subsequently, a technical team, led by the United States and Belgium, was established to formulate the details of implementing these additional sanctions.

Presently, all G7 members have enforced a direct ban on Russian rough diamonds, effective from January 1, 2024, and an indirect ban (specifically on polished diamonds) starting from March 1, 2024, to be fully implemented by September 1, 2024. This measure is purportedly intended to eliminate the current exemption for goods that have undergone 'substantial transformation' elsewhere.

The prohibition mandates that all diamonds, regardless of being rough or polished, from non-G7 countries must undergo certification in either Belgium or Canada to verify their non-Russian origin.

Additionally, on December 22, 2023, the United States issued a Presidential Executive Order, expanding the ban to include diamonds of Russian origin that have been incorporated or significantly transformed into other products outside the Russian Federation, such as watches and jewellery containing Russian diamonds.

Of particular concern to Botswana and other diamond-producing nations is an alleged note in the EU's official register, confirming that the ban, starting March 1, 2024, applies to polished diamonds over 1 carat, decreasing to 0.5 carats by September 2024.

The phased implementation of indirect import bans takes into account the necessity for deploying an effective traceability mechanism, facilitating enforcement measures while minimising disruptions for market players.