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Africa: Diamond trade

The African diamond industry came under pressure in the late 1990s when it became clear that conflict diamonds where playing a role in the brutal wars in Angola, Sierra Leone, Liberia, and the Democratic Republic of Congo. The term conflict diamonds or blood diamonds (link to sidebar) refers to diamonds illegally traded to fund conflict in war-torn areas, particularly in Africa, and often linked to human rights abuses.

In the late 1990’s the sale of conflict diamonds perpetuated the decade long civil war in Sierra Leone that was renown for its brutality – rebels’ trademark in the war was not just to kill their opponents, but to maim them by chopping of hands, limbs, and other appendices. 

Proceeds from the sale of rough cut diamonds were used to purchase weapons and fund other illegal activities that fueled warfare by rebels groups. Easily transportable, once rough cut diamonds are brought to market in other countries, their origins can be extremely difficult to trace, unless a system is in place to trace them.   

Partly in response to the atrocities being committed in Sierra Leone, in 2000 the international diamond industry adopted a resolution to block conflict diamonds from reaching market. Working with the U.N., governments, and non-governmental organizations (NGOs), the diamond industry adopted the Kimberley Process Certification System in 2003 to track the life of rough diamonds during every stage of their life from the bottom of a mine to your diamond engagement ring with a tracking number. For more on The Kimberley Process, click here. Link to slidebar.

The diamond industry claims that the Kimberley system has helped stem the tide of conflict diamonds on the world market and that they can now guarantee that 99 percent of rough diamonds are from conflict free sources.

But that still leaves one percent that are unaccounted for. The wars in Sierra Leone and Angola are over, but conflict diamonds are still said to be funding rebels in the ongoing civil war in Ivory Coast.

The United States General Accountability Office (GAO) released a report as recently as Sept. 2006 stating that the U.S. is still vulnerable to the illicit trade of rough diamonds because even though there is general adherence to the Kimberley Process, there are still kinks in the system. The GAO report noted that the U.S. does inspect all rough diamond imports to certify their origins. The report said because of spotty statistics on diamond imports and exports, the country is "still vulnerable to illicit trade of rough diamonds."

In response to the GAO report, U.S. Homeland Security pledged to work with the State Department to record detailed information about diamonds entering the country and promised to conduct more random examinations of diamond shipments.

True compliance can also only be guaranteed if the market and consumers demand it. Click here to link to a Buyer’s Guide to Conflict-free diamonds sidebar.

Side bars:
U.N. definition for conflict diamonds:
“Conflict diamonds are diamonds that originate from areas controlled by forces or factions opposed to legitimate and internationally recognized governments, and are used to fund military action in opposition to those governments, or in contravention of the decisions of the Security Council.”

Side bar: The Kimberely Process
The Kimberley Process requires that each shipment of rough cut diamonds across an international border must: be transported in a tamper resistance container, have a forgery resistant conflict-free certificate, and a unique serial number. Shipments of rough cut diamonds can only be exported to other Kimberley Process participating countries – of which there are now 69. It is illegal for uncertified shipments to be imported or exported in those member countries.

In addition, to support the Kimberley Process, the international diamond industry agreed to a voluntary “System of Warranties” to ensure that diamonds are tracked at every stage in the chain of trade – from the import of the diamonds up to the sale to the consumer. When a consumer buys diamonds or jewelry containing diamonds, they should be able to demand and receive a written guarantee that traces the life of the diamond from the mine to the storefront and can guarantee that the diamonds are conflict free.
External Hotlink:

GAO Report