Tanzanite/Terorrist Debate Continues

November 29, 2001

Tanzanite/Terorrist Debate Continues

Afgem, a South African mining company which controls a portion of Tanzania's tanzanite mines, says it's troubled by allegations of tanzanite sales funding the al Qaeda terrorist network but pledges to continue to attempt to formalize trading. Afgem controls one block of the tanzanite mines in Merelani, Tanzania. Independent miners work the other blocks.

"It is most distressing that the tanzanite trade, like so many other industries, has been implicated with the al Qaeda network," says Joanne Herbstein of Afgem. "The tanzanite industry has been unregulated and informal, with little control of the channel through which tanzanite exits Tanzania. With this historic lack of regulation, illegality was bound to prevail." On Nov. 16, the Wall Street Journal reported a connection between an al Qaeda cell operating in Kenya and Tanzania and tanzanite gemstones.

Afgem also criticizes Tanzania's independent small-scale miners who uncover the majority of the world's tanzanite at other blocks in Merelani. "Tanzanite has been mined on an informal basis by small-scale miners that typically have neither the capital nor the technology to employ safe mining methods. This has resulted in many tragic fatalities and has opened the market to the exploitation of child labor, much to the disdain and concern of international labor bodies and the Tanzanian government," says Herbstein.

To formalize and regulate some tanzanite trade, Afgem continues its quest to brand its tanzanite. "Our Tanzanite Foundation brand will further ensure the socially-aware consumer of the origin, mining methods and export channels of their purchase," Herbstein says. Afgem's brand was announced more than a year ago and has been resisted by all other tanzanite miners in Merelani. Small-scale miners say the brand would marginalize and degrade their product. Dealers say Afgems strategy amounts to an effort to monopolize the gemstone. Recent reports say the Tanzanian government has remained cool to the branding initiative.

In other industry reactions to the tanzanite/al Qaeda connection, some associations express skepticism about the allegations. International Colored Gemstone Association President Eli Eliezri says that the impression created by the WSJ report that al Qaeda representatives control a major part of the tanzanite trade and realize profits in the millions is false. Eliezri says the community of dealers in rough tanzanite is small and most are ICA members – he estimates 90%. "ICA members are committed to maintaining and perpetuating the highest eithical standards," he says, pledging that ICA will work with law enforcement authorities and other organzations to counter any possibility of colored gems playing a role a national or international conflict.

A statement by Jewelers of America is expected this week. JA says a direct-mail guidance sheet will also be mailed to members. JA says it's hoping to work on a joint statement with organizations representing other segments of the U.S. industry.

Retailers say developments following WSJ report have unfolded so quickly they have been caught off-guard. Many say they await guidance by gemstone associations such as ICA and the American Gem Trade Association (an official position from AGTA has not yet been released). Most retailers are talking to their suppliers before making policy decisions regarding the gem, though QVC and Zales made statements yesterday regarding the gem (see "QVC Suspends Sales of Tanzanite" in Daily News Archive).

- by Robert Weldon, G.G.

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