November 4, 2002
Representatives of 45 countries that produce, sell or trade in diamonds are about to endorse the beginnings of a system to prevent African warlords from fueling their conflicts through so-called blood diamonds.
The representatives were scheduled to meet at Interlaken, Switzerland, on Monday and Tuesday, two years after a passionate debate over illicit diamond sales galvanized the gem industry and forced even the giant De Beers cartel into a major shift of corporate strategy. The 45 countries, which include the United States, are to give formal approval to new rules intended to make sure that, from the gravel of diamond mines to distant jewelry stores, diamonds will be certified as untainted. The goal is to prevent illicit diamonds being used to pay for the weapons used in wars, from Angola to Sierra Leone.
But many of the advocacy groups that first inspired the debate said Friday that a system of written warranties that was offered last week by the diamond-cutting and trading business to complement the government effort was critically flawed because it could not be audited.
"Despite two years of repeated promises, the diamond industry has failed to deliver a detailed and credible self-regulation system that will stem the flow of conflict diamonds," said Alex Yearsley, a campaigner from the London-based group Global Witness, which raised the issue in 1998.
The 45 countries are meeting to discuss what is known as the Kimberley Process, under which government and industry figures have been trying to formulate legally binding rules.
The U.S. government has taken a particular interest in pressing the countries to introduce a certification system by Jan. 1. A senior State Department official, James Bindenagel, was appointed the special negotiator for conflict diamonds. The U.S. concern coincides with persistent but largely unsubstantiated reports that operatives of Al Qaeda laundered money through diamonds mined illicitly in Sierra Leone. The United States also accounts for half the world's $60-billion-a-year trade in stones sold as jewelry after rough diamonds are cut and polished into sparkling gems.
"It's imperative that we launch on time," Bindenagel said in a telephone interview from Washington on Friday. He said that the United States intended to require certification beginning Jan. 1, and if European and other governments failed to commit themselves to introduce the new system by then, the world diamond trade could be disrupted.
"We still regard this as an emergency," he said, citing reports of continued diamond-fueled conflict in the Central African Republic and the Democratic Republic of the Congo. Christine Gordon, an independent, London-based diamond analyst, said that, while there had been no corroboration of reports linking the diamond trade with Al Qaeda, there were strong suspicions of ties between Lebanese diamond smugglers in West Africa and the militant Hezbollah movement in Lebanon.
To a large extent, the Kimberley Process has come too late to prevent the worst excesses of diamond-financed warfare in Africa. However, a UN report chronicled the continued activities in Congo of what it termed "elite networks" of politicians and soldiers involved in "the illegal exploitation of the country's national resources."
In theory, such illicit traffic will become much more difficult. Governments of diamond-producing countries will be required to license the miners, and the trade in rough diamonds across borders will be controlled by tamper-proof methods for certifying shipments and other measures.
Previously, buyers in cutting centers like Antwerp, Belgium, or Tel Aviv were under no formal obligation to ascertain the origin of rough diamonds offered by sellers. Once diamonds are cut and polished, their origins are even more difficult to trace. In addition, rough diamonds, particularly those found in riverbeds, are easy to smuggle.
Eli Izhakoff, the leader of the World Diamond Council, an industry body, said that the work to create the system had "squeezed out a lot of the profit-taking from the blood diamonds."
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