May 9, 2000
Mr. Chairman, distinguished members of the Committee: I am greatly honored and pleased to appear here today on the question of what can be done to curb the powerful contribution of illegitimate diamond trade to African conflicts. This is a timely, important gathering on a complex subject that cannot possibly be overlooked or wished away; nor can it be reduced to quick, simple formulations. Members of Congress, non-government organizations, and the media have all, in the past year, drawn increasing attention to this problem. I commend you for taking the constructive step of calling us together today to take account of the scope and nature of the problem, what has been done to address it, and the way ahead.
I also wish to commend you for bringing together in today's dialogue several important figures integral to the evolving international debate over conflict diamonds.
These diverse witnesses are each dedicated individuals who have thought long and hard about what pragmatic steps make sense. They are essential players, if we are to build an effective international coalition, comprised of producing and consuming countries, market centers, private industry and non-governmental bodies, dedicated to advancing pragmatic, feasible incremental reforms related to this complex issue.
Our Dual Foreign Policy Interests
The central foreign policy challenge we face is to reconcile two critical imperatives:
1. First, to devise feasible measures to curb the powerful contribution to African conflicts of illegitimate diamond trading: both through tightening of global marketing practices and direct assistance in building capacity to manage the diamond sector in conflicted states such as Sierra Leone;
2. Second, and equally important, to ensure we do no harm to the stable market democracies -- Botswana, South Africa, Namibia -- who depend heavily on gemstone diamond production and international consumer confidence.
For the record, I want to reaffirm emphatically at the outset that we will take no action in regard to trade in diamonds that puts at risk the national interests and economic welfare of Botswana, South Africa and Namibia. That is an unequivocal pledge we have made directly and repeatedly to these governments in our recent consultations in early March in southern Africa. We have stood by that pledge consistently, and will continue to do so.
Achievements to Date
Mr. Chairman, in the past year there have been many promising initiatives launched in regard to conflict diamonds that we will hear much about today.
More than we anticipated, these efforts have begun to achieve concrete results that we need to acknowledge and systematically build upon now.
Most notable are: The achievements of the UN Sanctions Committee on Angola, through the work of Canadian Ambassador Robert Fowler and the Experts Panel; The steps taken by De Beers to guarantee that none of the diamonds it issues at the Central Selling Organization originates in conflict zones; The southern African initiative, led by the South African Government and strongly supported by Botswana and Namibia, to convene an international conference May 11-12 in Kimberley to weigh options to tighten regional law enforcement, harmonize customs, and enhance exchange of information; Efforts by USAID, industry and the Sierra Leone Government to lay the groundwork for the creation of the Strategic Resources Commission, called for in Article IX of the Lome Accord, to rationalize Sierra Leone's diamond sector and make it a force for stability, national welfare, and development as opposed to a contributor to continued war. Steps underway by the Belgian Government and the Diamond High Council in Antwerp to tighten the entry requirements of diamonds into the Antwerp marketing center.
Certainly much more work remains to be done. Each of these endeavors is still at an early point, and no single endeavor answers the entire challenge. But we have made considerable progress in the last twelve months.
Norms and practices are beginning to change in the international diamond industry, in recognition that it is in the industry's best self-interest to be pro-active and responsible. The UN effort led by Ambassador Fowler has redirected international attention to sanctions enforcement on UNITA and has begun to narrow UNITA's options. New dialogues across industry, governments and the non-government sector have ensued. These are all highly encouraging developments.
The Administration's Approach
Allow me a moment to comment briefly on the evolution of the Administration's approach.
In 1999, the State Department began to examine the role of diamonds in African conflicts in close collaboration with the British Government.
Our immediate impetus was the imposition of UN Security Council sanctions on UNITA diamonds in June 1998, and the subsequent establishment of the Experts Panel, under the direction of Canadian Permanent Representative Robert Fowler, Chairman of the UN Sanctions Committee on Angola.
We recognized the central need and importance of these actions, and began searching for ways to support Ambassador Fowler's efforts.
These Security Council actions were taken out of recognition that the Lusaka Protocol had failed, in 1998, because UNITA, one of the parties in the conflict, failed to comply with key parts of the Lusaka Protocol. It is estimated that from 1994 to 1998, UNITA's weapons acquisitions were financed by an estimated $3-4 billion in illicit diamond sales. These arms enabled a continuing war; a potentially stable peace was lost. Angola returned to a cruel war that had already cost half a million lives, displaced over three and a half million (3.5 million) persons within Angola, and forced another 300,000 to flee to neighboring countries. Almost overnight a million persons who had returned to their homes, in hope that peace would hold, were again displaced violently. Soon thereafter, Angola again became one of the world's worst humanitarian crises.
We were also motivated by an awareness of how integral illegitimate diamonds had become to ongoing conflict, violent displacement, and the death of tens of thousands of civilians in two other crises zones in Africa, Sierra Leone and Congo.
The Revolutionary United Front (RUF) insurgency in Sierra Leone, on the strength of diamond smuggling, swiftly transformed itself in the 1990s from a rag-tag band of several hundred into a well-equipped force of perhaps as many as 20,000. In the process, it killed an estimated 50,000 Sierra Leoneans, committed thousands of atrocities, generated half a million refugees, and displaced fully one third of Sierra Leone's four and a half million citizens.
That is a staggering human catastrophe that would not have been possible, even in the midst of such chaotic political conditions, were it not for illicit, smuggled diamonds that found markets and were readily converted into arms shipments and other material of war.
When the Lome Accord was signed in July, 1999, and called for the establishment of a Commission on the Management of Strategic Resources to rationalize the diamond industry, we recognized the need to mobilize our own technical support and that of other governments and the industry itself to help build this essential capacity.
Tragically, this past week the RUF is presumed to have killed seven Kenyan peacekeepers and to have detained and or surrounded more than 2,000. This crisis clearly has its roots in the RUF's continued capacity to arm and equip itself through clandestine cross-border channels that make use of friendly neighbors, most notably Liberia, and that rely on diamond exports. Estimates of the value of this illegitimate diamond trade vary widely, from $30 to $100 million per annum. Indeed, the current violence is at least partly rooted in the RUF's unwillingness to give up the diamond-producing areas.
In eastern Congo, diamonds are integral to the Congolese Rally for Democracy (RCD) and the Movement for the Liberation of the Congo (MLC) insurgencies, and their external allies in Rwanda and Uganda. Diamonds that move through underground channels are also integral to the war- making capacities of the Kabila Government and its external allies.
Illegitimate trade in diamonds in Congo is estimated today to exceed $400 million per annum, but we know far too little, certainly less than in Angola and Sierra Leone, about how precisely this sector sustains an economy of war in the Congo. What is undeniable, however, is that conflict diamonds skew incentives heavily in favor of continued conflict.
It is out of recognition of this disturbing reality that UN Secretary General Kofi Annan recommended that the Security Council consider creating a Panel of Experts to investigate the illegal pillaging of Congo's natural resources. Members of the Security Council are giving full and active consideration to creation of such a panel.
We are still very much in the preliminary investigative phase of our attempt to grasp the scope and role of unregulated diamonds in Africa, as they relate to devastating conflicts in Angola, Sierra Leone, and Congo. We commissioned internal studies and carried out joint consultations with the British in July, 1999.
These efforts were followed by Secretary of State Albright's statement at the September, 1999 Security Council Ministerial, in which she highlighted the arms/diamonds dimension to Africa's conflicts and the urgent need to identify feasible measures to address it. Subsequently, she pressed these same points in December at the G8 Berlin Ministerial on conflict prevention.
In early October, 1999, the State Department sponsored an international conference here in Washington with a special focus on the economies of war in Angola, Congo and Sierra Leone. That was the occasion to open a direct dialogue with diamond officials from Botswana and Angola. Soon thereafter we conducted consultations with executives of the American diamond industry, in Washington on November 19, and again last week in New York.
In March, we sponsored a Strategic Planning exercise for he Government of Sierra Leone, with the participation of international diamond industry leaders, which resulted in proposals that are realistic and workable.
In late February and early March, we and our British counterpart visited southern Africa and Belgium. During that trip, at a conference in Gaborone that brought together diamond officials from Botswana, South Africa, Namibia and Angola, we were able to build consensus around the twin goals of defining pragmatic measures to combat conflict diamonds while taking special care to do no harm to the stable market democracies of Botswana, Namibia and South Africa. Beginning on Thursday of this week in Kimberley, in the Republic of South Africa, we will participate in a regional conference organized by the South African Ministry of Mines and Energy.
Next steps
Mr. Chairman, there is no single fix to the problem of conflict diamonds in Africa. Rather, it is essential that we press ahead simultaneously on multiple fronts and that we recognize this is a difficult, complex problem that will take time to address. As I indicated at the opening of my presentation, we have dual imperatives: To devise feasible measures to curb the damaging contribution of illegitimate trade in diamonds in the Congo, Angola and Sierra Leone.
- To ensure we do no harm to Botswana, Namibia and South Africa, stable market democracies heavily dependent on diamonds.
In the coming months, we will actively seek to support progress in the following areas: To follow-up Ambassador Fowler's innovative work, a five- person panel will be appointed in May, under the Secretary General's direction, to continue investigation of effective sanctions enforcement measures (for diamond as well as other sanctions) on UNITA and to advise the Security Council of additional actions. As the situations in the Congo and Sierra Leone evolve, the Security Council will need to weigh how best to address the arms/diamonds dimension that constrains efforts to bring about a durable peace in these two countries. We anticipate providing technical assistance, as warranted and welcomed by the southern African states, to support the initiatives of the Kimberley conference, and the subsequent African Ministerial meeting planned for July. We will work with the British and other G8 partners to raise the profile of conflict diamonds and the pragmatic means of addressing it. When the situation in Sierra Leone has stabilized, we will continue our efforts to support the establishment of the Sierra Leone Commission on the Management of Strategic Resources. Defining lines of authority and a detailed blueprint for the Commission are essential next steps. We look forward to working closely with you, Mr. Chairman, with the sub-Committee and with members of your staffs in thinking through actions by the Congress, which has taken a constructive and proactive interest in this difficult problem.
Thank you for your attention. I welcome any questions you might have.
