Professional Jeweler Archive: Dirty Diamond Debate Continues

May 2000


Dirty Diamond Debate Continues

De Beers guarantees it won’t buy or sell diamonds from conflict regions

De Beers has taken further steps to guarantee it won’t do business with any African sources suspected of selling diamonds that fund anarchy and mayhem. Starting with its March 27 sight allocation, the Diamond Trading Co. Ltd., De Beers’ selling division, began printing a notice on buyers’ invoices stating:

“The Diamond Trading Company Ltd. guarantees that:

A. No diamonds in this box have been purchased in breach of U.N. Resolution 1173 [which prohibits diamond purchases from the rebel group UNITA in Angola].
B. The intake of diamonds being purchased by De Beers and its associated companies and being sold into the market through the sight system do not include any diamonds which come from any area in Africa controlled by forces rebelling against the legitimate and internationally recognized government of the relevant country.”

In addition to this statement, De Beers withdrew the buyers it had in the Democratic Republic of Congo and Guinea (it has not had buying offices in Sierra Leone or Liberia for 15 years, the company says, and in October stopped buying from Angola also.) The company also instructed its Diamdel buying offices in Antwerp, Belgium, and Tel Aviv, Israel, and all other locations to stop buying any diamonds imported from Africa.

De Beers also asked its sightholders not to buy diamonds from any conflict zone or – in their independent buying – to avoid buying any diamonds of questionable origin.

De Beers’ Future in Angola

What future role De Beers plays in Angola is unclear. While it has very publicly withdrawn from buying Angolan diamonds in any of its worldwide offices, De Beers has, in the past, spent tens of millions of dollars investing in Angolan mine exploration north of Saurimo in the Cuango Valley.

De Beers spokesman Andrew Lamont says De Beers is seeking clarification of its position. “For now our efforts [in not buying conflict diamonds] should go some way to reassure downstream dealers, manufacturers and retailers that the goods we are supporting are indeed legitimate,” says Lamont.

That’s a point manufacturers and retailers are sure to hear more about in the near future. De Beers’ strategic internal review is geared toward increasing stockholder profits and it may well find moving out of Angola – for now – plays nicely with its well-publicized branding efforts and its strategy to become the diamond supplier of choice. Says Lamont: “By doing what we are doing, we hope to make the distinction that we support those countries in Africa which, through the diamond business, have helped bring prosperity and jobs to their people.”

– by Robert Weldon, G.G.

Conflict Areas Where
Diamonds Are Mined or Sold

Copyright © 2001 by Bond Communications