Conflict Diamonds: A Resolution

July 19, 2000

Conflict Diamonds: A Resolution

Two of the world's largest diamond organizations agreed today on a nine-step process calculated to stop the trade of diamonds funding conflicts in Sierra Leone, Angola, the Democratic Republic of Congo and Liberia. Meeting at the 29th World Diamond Congress in Belgium, the World Federation of Diamond Bourses and the International Diamond Manufacturers Association hailed the agreement as a breakthrough. The activist groups that called the issue to the world's attention also endorse the plan.

Positive repercussions are expected all the way down the diamond pipeline, from producer to retailer. Retailers in particular will benefit now that they can answer consumers' concerns with concrete examples of what the industry will do about conflict diamonds. Industry analysts believe the plan will restore any flagging confidence and say supplies and prices will likely remain stable. "We believe the plan is implementable in the short-term and does not preclude further steps being taken when the means and requirements arise," the document states.

Listed in the document are actions the industry is not able to take:

  1. We recognize that rough diamonds individually are not sufficiently determinable as to source and origin. However, with the correct system, rough diamond parcels can be monitored within a net.
  2. There is no implementable way to tag, track and identify finished polished diamonds.
  3. All legitimate rough diamonds can travel within an identifiable net.

Also listed are actions the congress wants the industry to take:

  1. Each accredited rough diamond importing country – whether a producer, manufacturer or dealing center – should enact "redline" legislation. As such, no parcel of diamond rough could be imported unless it has been sealed and registered in a universally standardized manner by an accredited export authority from the exporting country.
  2. Each exporting country, which can be a producer or accredited dealing/manufacturing center, should establish accredited export offices or a diamond board that seals parcels of rough diamonds to be exported and registered in an international database. If the country is a producer, it should be accredited only if it has control mechanisms to determine the flow and legitimate ownership of the rough to be exported.
  3. Polished-diamond-consuming countries should enact legislation forbidding the importation of polished diamonds from any manufacturing/dealing country that has no redline legislation of rough.
  4. As part of the diamond net, every country – be it a rough exporter, importer or polished-consuming country – should enact legislation calling for criminal penalties against any person or company proven to be knowingly involved in illegal rough diamonds.
  5. Every diamond organization should adopt an ethical code of conduct on conflict diamonds, labor practices and good business practices. Failure to adhere to this code would lead to expulsion from WFDB, IDMA and other relevant organizations.
  6. As a positive measure of compliance, all relevant and interested parties should promote adherence to the code in the consumer marketplace.
  7. The trade should enlist the support of banks, insurance and shipping companies and other pertinent providers of goods and services to expose and cease business relations with anyone found knowingly violating these principles.
  8. The trade should conduct continual analysis of relevant technologies – and invest in developing them – for implementation leading to greater compliance.
  9. Compliance should be monitored and controlled by an International Diamond Council, composed of producers, manufacturers, traders, governments and relevant international organizations. This process would be fully verified and audited.

NGO Support
Endorsing the plan are representatives of some 60 activist groups (also known as non-governmental organizations or NGOs). Among them are Global Witness, Amnesty International, World Vision, Physicians for Human Rights and Fatal Transactions and Partnership Africa Canada. The NGOs stress they will keep a watchful eye on how the industry implements the plan. They also praised WFDB and IDMA, saying they had never seen an industry respond as quickly. "The test will be the willingness by the industry to quickly finger out those who are dealing in conflict diamonds," says Ian Smillie of Partnership Africa Canada.

Global Witness first drew the world's attention to the horrific treatment of thousands of innocent civilians in war-torn African countries. The wars have been funded to a great extent by the sale of diamonds by rebel groups, so the NGOs have pressured diamond organizations to sever the link between diamonds and conflicts. They hope the plan adopted today will do just that, forcing a halt to the commerce of diamonds from these countries. According to the U.N. and others, about 4% of diamonds on the world market fund conflicts. Meanwhile all parties, including the NGOs, agree it's imperative not to damage trade in the world's legitimately traded diamonds. Several African countries - including Botswana, Namibia and South Africa - depend on the diamond trade for their economic strength.

- by Robert Weldon, G.G.