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Africa Policy E-Journal
Africa: Conflict Diamonds, 2 +++++++++++++++++++++Document Profile+++++++++++++++++++++
Region: Continent-Wide +++++++++++++++++end profile++++++++++++++++++++++++++++++ Additional Sources on Diamonds and Conflict Documents recently reposted by APIC
Africa: Conflict Diamonds, 1
Angola: Sanctions Updates
Sierra Leone: Diamonds and War
Angola: Diamond Trade and War Other Sites
Diamonds.net (http://www.diamonds.net) Fatal Transactions (http://www.niza.nl/uk/campaigns/diamonds) Netherlands Institute for Southern Africa, Global Witness, Medico International and Novib collaborate in this campaign. Site includes additional links.
Conflict Diamonds Possibilities for the Identification, Certification and Control of Diamonds A Briefing Document by Global Witness. June 2000
Published by Global Witness Ltd, P O Box 6042, [Excepts only below: full text on http://www.globalwitness.org] This report has been produced by Global Witness. Partial funding was received from the UN department of the UK Foreign and Commonwealth Office (FCO), without which the report would not have been possible. The views expressed within are solely those of Global Witness. There are many individuals, companies and countries (too many to list) that kindly cooperated with the production of this report and we are grateful for their time, patience and generosity. Contents Introduction 1 The Structure of the Diamond Industry 2 Diamond Identification Methodologies 3 Legislative Overview on the Export and Import of Diamonds 4 Technologies and Control Systems in Use in the Diamond Trade 5 Certification Systems for Other Products 6 Recommendations for a Control System 7 Conclusion Glossary References Recommendations
Summary In this document Global Witness is outlining recommendations for a global diamond certification and verification system to be monitored by an independent diamond verification organisation and to be backed up by industry self-regulation and government legislation. This system would need to be implemented and enforced in any country wishing to export/import/mine or work diamonds in any way. The basis for this system is outlined in detail in Section 6 of this report; however a brief summary of the main points follows: In order to help end the trade in conflict diamonds, diamond producing and exporting countries should:
In order to help end the trade in conflict diamonds, diamond trading and importing countries should:
In order to help end the trade in conflict diamonds all diamond traders, polishers, manufacturers and retailers should:
Recommendations for a Control System INTRODUCTION This section, drawing upon the rest of the report, makes a series of recommendations aimed at developing both a regulatory framework by governments and a self-regulatory system for the trade. It should be emphasised that these are recommendations and are intended to frame the terms of a debate for reform rather than be a set of finalised instructions. Initial research, which was not exhaustive, has identified applicable technology that is either developed, or is being developed. Global Witness advocates that trade and governments consider the following existing possibilities. Currently there are systems that can: calculate and record the individual surface profiles of rough diamonds; confirm the identity of a parcel of stones that has been registered using this method; mark rough diamonds with individual bar codes or other readable inscriptions; mark cut diamonds with codes, bar codes and logos; identify and verify the identity of cut or rough diamonds that have been coded; record and verify the individual optical signature that a cut diamond exhibits using laser refraction. A system using elements of these coupled with improved regimes in exporting countries, and the introduction of relatively low-technology identification techniques including work on surface features and profiling of run-of-mine production could be used as a basis for reform by both governments and trade. Governments and the trade must finally accept it is their responsibility to ensure that diamonds are not involved in the funding of conflict, and take action accordingly. The key point is that government and industry, whilst having different responsibilities, do need to work together and produce a coordinated system that comprises both regulation and self-regulation. The recommendations are more detailed for governments than for trade. This reflects work already undertaken by governments and their national trade bodies, particularly those that have recently come under severe criticism. The recommendations for the trade provide a structure but do not go into the same level of detail because Global Witness believes a different approach is needed for the trade. The complexities of developing meaningful self-regulation within an industry that does not have a coordinating body that can act as a focal point for all the different parts of the industry mean that for Global Witness to develop a series of detailed recommendations at this stage in the process would not be particularly productive. Instead this section gives some outline recommendations to give the trade an indication of what are minimal acceptable standards for controls. An important and urgent first step would be for the diamond trade to set up an industry taskforce or reform committee to immediately begin working on the issue. The taskforce should be representative of the industry and able to reflect the views of the different parts of the diamond pipeline (see Recommendations below for more detail). This would be an important forum for the trade, enabling the different parts, traders, polishers, retailers and so on, to ensure that they are working in concert rather than producing contradictory initiatives and reforms. It will also ensure that different sectors of the diamond industry can be fully involved at every stage in developing a self-regulatory framework. The taskforce should be small and comprised of representatives of different sections of the industry that have a real, and perhaps already proven, interest in reform and controls. Global Witness would be happy to cooperate with such a taskforce, and recommends that it seeks cooperation from government representatives to ensure that the self-regulatory measures can work in tandem with government regulations. This taskforce should be a short term one, and part of its mandate should be to work with governments and NGOs to set up a permanent International Diamond Committee (the name is a suggested working title) which would oversee the implementation of self-regulatory measures developed by the taskforce. It may seem initially confusing to have two bodies but they would serve quite distinct functions, the first being a shortlived initiative to get the reform process moving, the second would be focused on implementation and regulation (see recommendations below for more detail). The membership of this committee needs to be carefully and equally balanced between different parts of the trade, government importers and producers, labour representatives and non-governmental organisations. It is preferable that the industry be fully involved in the developing of solutions as the alternative scenario would be for governments to impose a series of stringent measures upon the trade, which is likely to make implementation of controls far more difficult. Global Witness is proposing that governments of diamond producing and importing countries should play a central role in setting a regulatory framework within which industry self-regulation can be a meaningful part of the process of controls. It is clear that governments and the commercial trade are looking to address the problem of conflict goods. If this is to be done effectively, both parties will need to significantly address the core problems within the trade as a whole. These include lack of infrastructure, and corruption in some producing countries, a willingness by some importing countries to accept the flow of conflict diamonds, lack of transparency within the commercial trade and the complexities of the movement of rough and polished diamonds. Unfortunately, due to the high value and fungibility of these goods, a system based solely on the trade making unverifiable declarations of self-regulation, is unlikely to significantly address these core problems, and may even lead to consumer cynicism about claims made by the diamond trade. The trade is well aware of the importance of consumer confidence and has already begun to look at how to maintain industry integrity and consumer confidence on issues such as synthetic diamonds and value enhancing treatments. If these issues are not properly addressed they pose a serious threat to all diamond producing countries. It is clearly time for radical changes within the diamond sector, about how it operates and about the need for an ethical basis to its operations linked to greater transparency. Global Witness believes that a strength of the industry is the importance placed on trust - there are very few industries where a deal worth perhaps a million dollars or more can be agreed with a handshake, and in some countries, the phrase "Mazel U'bracha," without the involvement of corporate advisors, lawyers or even contracts. This is possible because although the diamond trade is a truly international and far-flung network it is also one in which the majority of the people one trades with are known quantities and are in a pattern of repeat business. This will be an important factor in the reform process. The HRD stated recently "The diamond sector needs a transparent, consistent and responsible structure with strong, efficient self-regulating mechanisms." A key part of such controls will be the rigour with which they are implemented by the industry. As British Foreign Secretary, Robin Cook noted in December 1999 "If the [diamond] industry could do it itself by self-regulation and by other proposals, that would be very welcome and I think the more we are seen to be pursuing this earnestly, the more it is likely they will do so." Indeed while the mystique of the diamond will doubtless always continue, the mystique of the diamond companies is an anachronism that has to change. The key issue at stake within an industry that has to date made it possible for companies and importing countries to evade their responsibilities and claim ingeniously, and often incorrectly, that either they could not identify the origin of their goods, or that even if they could, and knew them to be from a conflict area, if they didn't buy them someone else would. True country of origin, i.e. of extraction, has never been made an important part of the business. However this has to change, and indeed, for different reasons already has, as Australian and Canadian producers have begun to use country of origin as part of their marketing strategy. This is not to say that overnight 'Country' is going to become the fifth 'C' (joining the current four 'Cs' - colour, clarity, carat and cut), but it does point to a need to be clearer about product history.
Conclusion The aim of this report is to try and provide an overview of the issues involved in conflict diamonds, to outline some of the technologies that could be applied to diamond controls, to delineate the scale and complexity of the business and to point the way forward. This edition was produced as a working document to be made use of at the technical forum on the issue of conflict diamonds hosted by the South African Government on the 11th and 12th of May. A final version will be printed and widely distributed immediately after the conference which will detail and analyse the results of the forum. Global Witness urges individual governments, regional groupings the international community, and equally the trade to take urgent action. Recent events in Sierra Leone, including the murder and kidnapping of UN troops and increasing instability should be a reminder of just how fragile peace is and how easy the potential to undermine it. To date the UN has still not tackled the issue of diamond revenue continuing to fund the RUF. The role of diamond revenue in Angola's continued conflict shows what a dangerous mistake it is to ignore the funding of rebel groups. The issue of conflict diamonds has, since December 1998, come to the fore on international agendas in just 16 months. By some measures this is a remarkably short period of time for the issue to have been understood and the concept established, for governments to have begun to move, for UN initiatives to have taken place, and for the trade to have begun to accept that it is a problem and to address the issue. And credit should go to many people for this. However when set against the suffering and devastation caused by conflict, and the impact day by day on the lives of people in affected countries, this issue is moving far too slowly. It is now time for all those involved in the industry to work urgently towards practical and measurable controls to combat conflict and strengthen legitimate producers and markets.
Documents previously distributed in the e-journal are
available on the Africa Action website: To be added to or dropped from the e-journal subscription list, write to e-journal@africaaction.org. For more information about reposted material, please contact directly the source mentioned in the posting.
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Africa Policy E-Journal
